The substitution of steel for wooden ploughs in agricultural production is an example of

Technological progress can be classified based on how it affects the productivity of different factors of production (labor and capital). When wooden ploughs are substituted with steel ploughs in agricultural production, it implies the adoption of a more advanced, durable, and efficient form of capital. The steel ploughs, being superior, enhance the productivity of the capital input itself. This makes the existing capital more effective or productive, which is termed 'capital-augmenting technological progress'. It is not primarily 'labour-augmenting' because the direct impact is on the tool (capital), not necessarily making labor more productive in isolation. It is definitely not 'capital-reducing' as it involves using more advanced and effective capital.