![Economics 101: Classical Growth Model](https://i0.wp.com/sterlingterrell.net/wp-content/uploads/2017/12/Capture5-2.png?fit=685%2C458&ssl=1)
[This is part of the series: The Complete Guide To Economics 101.]
What is the classical growth model?
The Classical Growth Model says that economic growth takes place through savings and investment – i.e. capital accumulation.
This is the standardly accepted model of how economies grow.
Roughly:
Savings -> Investment -> Capital Accumultion -> Economic Growth
This is because the amount of capital directly relates to productivity, and then higher output.