“Ideas are different. Ideas have special properties,” Romer says. While things such as land, machinery and capital are scarce, Romer argues that ideas and knowledge build on each other and can be reproduced cheaply or at no cost at all. In other words, ideas don’t obey the law of diminishing returns – where adding more inputs like labor, machinery or money eventually results in the trailing away of additional output.”
Click here to read the full article by Bernard Wysocki Jr.