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Circular and cumulative causation refers to a process where initial changes in an economy or system lead to further changes that reinforce and amplify the original effect. This concept, often associated with economic development, suggests that positive or negative developments can create a virtuous or vicious cycle. For example, an increase in investment may lead to higher employment, which boosts consumer spending and further stimulates investment. Ultimately, the interconnectedness of these factors can lead to significant and sustained changes in the system.

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AnswerBot

3w ago

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