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Baumol argued that in an economy where productivity is growing in most sectors (called progressive sectors)...

Baumol argued that in an economy where productivity is growing in most sectors (called progressive sectors) and lagging in a few (non-progressive sectors), employment can still increase in the non-progressive sectors:

a. by investing in more labor-saving technology in the non-progressive sector.
b. by transferring resources from cost-saving innovation in the progressive sector to the non-progressive sector.
c. if employers in the non-progressive sectors lower wages.
d. by raising prices in all sectors.
e. as long as resources are transferred to the progressive sector.
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