 It depends on a number of neoclassicals which are often inappropriate for developing economies, for example it assumes that there is only one single production sector or that all sectors are symmetrical. This does not allow for a growth-generating reallocation of capital and labor between sectors that are transformed during the process of structural change. According to Scott and Auerbach, the main ideas of the new growth theory can be traced to Adam Smith and increasing returns to Marx's analysis. . Srinivasan finds nothing new in the new growth theory because increasing returns and endogeneity of variables were taken from neoclassical and Kaldor models. Fisher criticizes the new growth theory because it depends only of production function and steady state. Economic growth in developing countries is hampered by frequent inefficiencies resulting from poor infrastructure, inadequate institutional structures, etc. Because endogenous theory neglects these influencing factors, its applicability to the study of economic development is difficult..