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Many things that affect the economy depend upon how much "stuff" is already there. A broader technology base means more innovation (= higher real GDP) in the future, because innovations build off one another. A larger money supply (= inflation) requires a larger growth in absolute dollar terms to achieve the same effect, because the important measure is the percentage growth in the money supply, not the absolute growth. More people (= population) have more babies, which leads to more population growth in absolute terms. Whenever you have to multiply out changes instead of adding them, you get exponential growth instead of linear.

There're some notable exceptions, eg. growth in the unemployment rate is usually linear, because it's already computed as a percentage. Growth in the absolute number of people unemployed is exponential.



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