Growth is defined as the increase in the real value of the Gross Domestic Product. The per capita value of the GDP determines, among other things, the living standards of the country's citizens. The pace of growth is expressed by the growth rate.

There are many drivers to economic growth. Above all, the amount of labour is of significance. In the USA this variable accounts for 1/3 of the growth rate. The rest results from the changes in labour productivity.

This in turn depends on:

• the amount of fixed capital per employee,
• changes in the amount of human capital within the economy,
• technological and organisational progress,
• economies of scale,
• changes in the structure of employment,
• institutional framework of the economy (such as the legal and political framework or religion).

The Solow growth model allows us to measure the contributions of the respective factors to growth. Solow uses the macroeconomic production function, which describes the relationship between the amount of production factors employed and the volume of output. Estimates of this function for the USA gave rise to the formulation of the so-called 1/3 rule: a 1% increase in fixed capital results in 1/3 point increase in the growth rate (the remaining growth, the so-called Solow residual, resulting from technological changes). An alternative approach was proposed in the 80s by Romer. According to him, increases to capital per capita do not entail decreasing returns, and that is due to externalities.

In order to accelerate growth, the state provides adequate institutional framework for business activity. This includes promotion of the market, a credible currency, ownership rights system which protects private property. Apart from these systemic tasks, the state undertakes many other activities to support growth, such as demand management or the control of aggregated supply.