When to Use Each

Use Harrod-Domar when

• You are doing **development-planning arithmetic**: estimating how much investment (or foreign aid) a low-income country needs to reach a target growth rate. The formula $I = v \cdot \Delta Y$ is transparent and auditable even when data are scarce.
• Capital is the dominant binding constraint and capital-labour substitution is empirically limited in the short run — typical in early-industrialisation contexts where technology is imported at a fixed $K/L$ ratio.
• You need a **back-of-envelope check**: if a country has $s = 0.15$ and $v = 3$, then warranted growth is 5%. That calculation takes ten seconds and gives a first-order answer.
• You are working in a **post-Keynesian or structuralist framework** where effective demand matters and factor markets do not automatically clear.

Use Solow-Swan when

• You are studying **long-run steady-state growth** and want to know where the economy will end up, not just whether it will grow this year.
• You want to decompose growth into **capital deepening and TFP growth** — the classic growth-accounting exercise used in virtually all empirical macro papers since Solow (1957).
• You are testing or discussing **conditional convergence**: whether poor countries grow faster than rich ones after controlling for steady-state parameters. This prediction is Solow's, not HD's.
• You are preparing for **graduate exams or CFA Level 2** economics. Solow is the canonical model in modern macro curricula; HD appears mostly as historical foil or development-economics tool.