Is FI the most significant improvement over this time? materials? lighter engines? computers on board? What has contributed more to get more power per volume?
Force = mass X acceleration
At heart, all energy potential in the car is coming from the combustion chamber. That potential can only increase via either increasing the mass (i.e. enlarging the chamber) or increasing the rate of expansion. For any particular fuel there’s going to be an optimal fuel/air mix, after which you can’t improve upon it. Thus, your only option is to increase the chamber size.
But that is all assuming that everything else is perfect. That may be the heart of the system, but it’s not the end of the system. A 2008 car with perfect gas/air mixing will most likely outperform a 1970 car with perfect gas/air mixing (if they had it) since there’s more to the system than just that.
Lotus, for instance, likes to use engines that are–relatively speaking–extravagant lawnmower engines. They do this by making cars with an extremely low weight. Audi kicked butt in the rally racing world by creating an impressive all wheel drive system. Many cars have won races through having improved aerodynamics. The first step to oomphing up most street engines isn’t to get bigger combustion chambers, but rather to increase airflow through it (most cars don’t get as much as they need for an ideal blast.)
So at heart, yes, if you’re just talking about an engine sitting on a brace, getting ideal airflow, a perfect gas/air ratio, no lubrication issues, nor any other things that could possibly sap energy, then yes your only hope is to up the chamber size, but in the real world, a breakthrough in lubrication or crankshafts or anything could bring you ahead of the competition. But of course, any improvement you make there will be perfectly valid for a car with more cubic inches. You’ll always be brought back to CI.
Lighter engines yes aluminum engines are lighter, but weight does not effect the amount of horsepower that is produced.
Improved fuel delivery technology is probably the biggest single improvement. Computerized fuel injection can deliver a much more precise amount of fuel which improves power and economy. There are some engines out there that at some engine speeds leave the throttle wide open (No pumping losses) and engine speed is controlled by injector duration, and tricks with camshafts.
Camshafts play a big part of what can be done today. Lift, duration, and cam timing are all compromises to get the best overall performance. On a modern engine you can have variable valve timing on one or both camshafts. My V70 has variable timing on the intake with really improves the torque in the mid range. You can also find engines out there that also have variable lift/duration. Where each camshaft has multiple lobes for each valve. When needed the computer switches the engine from one set to the other.
I think that in the not too distant future you will see some type of direct actuation of the valves on an engine using air pressure or something similar. This will remove all the compromises that camshafts have had since they were invented.
So if I had to pick the most significant improvement improvement I would say fuel injection. A carburetor is on a technological level of a toilet bowl. But nothing exists in a vacuum and improvements in fuel injection are coupled with all the other improvements that have come down the pike over the years.