Economic Growth

A Presentation ByMegha Gupta

-An Economics Presentation

Defining The Term

Economic growth is enabled by increase in productivity. Economic growth is also the result of population growth and of the introduction of new products and services.

In Economics, Economic Growth is defined as the increasing capacity of the economy to satisfy the wants of goods and services of the members of the society.

Economic Growth Per Capita

Often, the concern about economic growth focuses on the desire to improve a country's standard of living—the level of goods and services that, on average, individuals purchase or otherwise gain access to. It should be noted that if population has grown along with economic production, increases in GDP do not necessarily result in an improvement in the standard of living. When the focus is on standard of living, economic growth is expressed on a per capita basis.

Measuring The Economic Growth

Economic growth is measured as a percentage change in the Gross Domestic Product (GDP) or Gross National Product (GNP). These two measures, which are calculated slightly differently, total the amounts paid for the goods and services that a country produced.

As an example of measuring economic growth, a country which creates $9,000,000,000 in goods and services in 2010 and then creates $9,090,000,000 in 2011, has a nominal economic growth rate of 1% for 2011.

In order to compare per capita economic growth among countries, the total sales of the countries to be compared may be quoted in a single currency. This requires converting the value of currencies of various countries into a selected currency, for example U.S. dollars.

Finance And Economic Growth

Financial markets significantly boost real economic growth and development. Finance has a positive impact on economic growth as a result of its effects on productivity growth and technological change.

Quality Of LifeHappiness has been shown to increase with a higher GDP per capita.Economic growth has the indirect potential to alleviate poverty, as a result of a simultaneous increase in employment opportunities and increase labour productivity.

But increases in employment without increases in productivity leads to a rise in the number of "working poor", which is why some experts are now promoting the creation of "quality" and not "quantity" in labour market policies.

Environment And Economic GrowthSome critics argue that a narrow view of economic growth, combined with globalization, is creating a scenario where we could see a systemic collapse of our planet's natural resources.More the economic growth more the money earned by people more the demand of the consumers and more is the stress on the industries to meet them. Ultimately these industries exploit the natural resources in order to meet the demands.

Conclusion

Economic growth can benefit the economy of a country in different ways. It creates competition between different countries and thus, an urge to boost the economy. For example, by improving the standard of living of the people by providing them employment increasing their income. But at the same time it can have negative effects like the exploitation of the natural resources.

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