Final answer:
True, continued economic growth requires innovation. Innovation leads to the creation of new and better products and is crucial for maintaining productivity and economic expansion.
Step-by-step explanation:
The answer to the student's question is True. According to the Growth Model, continued economic growth does indeed require innovation. This is because innovation leads to technological change, which is a combination of invention—advances in knowledge—and the practical application or commercialization of these inventions, which is innovation itself. The technological change results in the creation of more or higher quality products, as well as different and altogether new products that contribute to economic expansion.
It's clear from the literature that technology has been identified as the most important contributor to U.S. economic growth. While growth in human capital and physical capital is significant, it often explains only half or less of the economic growth. New ways of doing things are incredibly important, which are often the result of technological innovation. As mentioned, innovation drives economic activity and is necessary for maintaining comparative advantage and growth in productivity.