Question 44 from UPSC CSE 2015 - Economy

Question

The substitution of steel for wooden ploughs in agricultural production is an example of

Accepted Answer

Correct Option: B. capital-augmenting technological progress

Strategy: Identify the good being improved (a plough) as a capital input. Determine that the technological change enhances the capital's productivity, not labour's, to classify it as capital-augmenting.

Key Info: In economics, technological progress is classified by which input's productivity is enhanced.

- **Capital-augmenting** progress increases the efficiency of capital inputs while holding labour constant. The shift from wooden to steel ploughs improves the output from the same unit of capital (the plough), enhancing capital productivity without directly affecting labour's capability.

- **Labour-augmenting** progress boosts the productivity of labour, often through better skills or tools that enable workers to achieve more with the same amount of capital.

- **Capital-reducing** progress involves technologies that require less capital to produce the same output. This does not apply here, as steel ploughs are more capital-intensive.

A plough is a classic example of a fixed capital good in agriculture. Innovations in plough design, such as the shift from wood to steel, are considered capital-augmenting because they allow more land to be tilled in less time, increasing the yield per use of the plough. This reflects the broader process of mechanization in farming and is relevant to growth theory and agricultural economics.

Answer

Option A: labour-augmenting technological progress

Answer

Option C: capital-reducing technological progress

Answer

Option D: None of the above