Final answer:
The low per capita outputs are primarily due to insufficient saving and investment, which hampers investment in both human and physical capital, crucial for driving economic growth.
Step-by-step explanation:
The low per capita outputs of the developing countries (DVCS) are explained by insufficient saving and investment. This is due to the fact that high saving rates are typically associated with high levels of investment, which in turn, are key to economic growth. Countries like China and the East Asian Tigers exemplify this with their high savings rates leading to significant investments in physical capital and education, propelling their economies forward. On the contrary, insufficient saving can impede investment in both human and physical capital, slowing economic growth.
While policies to invest in human capital, such as education, or to foster technological advancement can greatly benefit economies, their productivity is variable and dependent on effective implementation. Moreover, the argument that technology alone can drive growth ignores other factors in the aggregate production function, such as human and physical capital, which can have decreasing marginal returns if not complemented by technological innovation. Hence, a balanced and sustainable economic growth strategy typically involves improvements in human capital, physical capital, and technology in a supportive policy environment.