In the long run, what causes the short-run aggregate supply curve to shift left after an increase in aggregate demand?

The shift of the short-run aggregate supply curve to the left after an increase in aggregate demand is primarily caused by higher wages and resource costs. When aggregate demand increases, it often leads to a rise in the price level, which can put upward pressure on input prices such as wages. As firms face higher costs for labor and other resources, their profitability at the initial price levels decreases. In response, they reduce the quantity of goods and services they are willing to supply at those price levels, resulting in a leftward shift of the short-run aggregate supply curve.

While increased consumer confidence, increased investment in technology, and expansionary fiscal policy can contribute to economic growth and shifts in aggregate demand, they do not directly cause the short-run aggregate supply curve to shift left. Instead, the phenomenon of rising costs due to increased demand is central to understanding this leftward shift, as it highlights the interplay between supply costs and demand dynamics in the economy.