In transitional stage saving rate play an important role in output
growth rate as proposed by Krugman. Accumulationists are also right
as claiming that learning-by-doing play an important role in TFP growth
in NIEs. However, using a CES production technology we can show that
the growth model based purely on learning-by-doing is constrained by labor growth rate. If the latter is constant in the long-run, then the growth can not be sustained.