The substitution of steel for wooden ploughs in agricultural production is an example of
[amp_mcq option1=”labour-augmenting technological progress” option2=”capital-augmenting technological progress” option3=”capital-reducing technological progress” option4=”None of the above” correct=”option2″]
This question was previously asked in
UPSC IAS – 2015
– Replacing a wooden plough with a steel plough implies an improvement in the efficiency, durability, or effectiveness of the capital good.
– Capital-augmenting technological progress makes capital more productive, meaning more output can be produced with the same amount of capital, or the same output with less capital (relative to labour), or it increases the effective amount of capital available. A stronger, more efficient steel plough allows for better tilling, potentially faster, requiring less effort to achieve the same result, or enabling tilling of harder soil, thus increasing the productivity derived from the capital input.
– Labour-augmenting technological progress increases the productivity of labour. While a better plough *might* allow a farmer to work faster or more effectively, the direct technological improvement is in the tool (capital), making the capital itself more productive.
– Capital-reducing technological progress is not a standard term in this context; the change here is about making capital *more* productive or effective, not necessarily reducing the absolute amount of capital used (though fewer trips might be needed, it’s primarily about enhanced capital productivity).