Economic Growth

Economic Development

usually indicated by an increase in citizens'

indicated by an increase in that
country'sgross domestic product,
quality of life
orGDP
often measured using the Human
Development Index
gross domestic product is an economic
model that reflects the value of a country's is an economic model that considers
output
intrinsic personal factors not considered in
a country's GDP is the total monetary value
economic growth, such as literacy rates,
of the goods and services produced by that
life expectancy and poverty rates
country over a specific period of time
Results from:
-Greater quantities of natural
resources, human resources, and capital
-Improvement in the quality of

resources
-Technological advances that boost
productivity

Implications

Factors

Measurements

Effect
Relevance

Economic
Development

Economic Growth

Economic development implies

changes in income, savings and
investment along with progressive
changes in socio-economic structure
of country (institutional and
technological changes).
Development relates to growth of
human capital indexes, a decrease in
inequality figures, and structural
changes that improve the general
population's quality of life.
Qualitative.HDI (Human
Development Index), gender- related
index (GDI), Human poverty index
(HPI), infant mortality, literacy rate
etc.
Brings qualitative and quantitative
changes in the economy
Economic development is more
relevant to measure progress and
quality of life in developing nations.

Economic growth refers to an

increase in the real output of goods
and services in the country.

Growth relates to a gradual increase

in one of the components of Gross
Domestic Product: consumption,
government spending, investment,
net exports.
Quantitative. Increases in real GDP.

Brings quantitative changes in the

economy
Economic growth is a more relevant
metric for progress in developed
countries. But it's widely used in all
countries because growth is a
necessary condition for development.

Stages of Economic
Growth
Traditional Society
Preconditions to Take-off
Take-off
Drive to Maturity
Age of High Mass
Consumption

Formula used to compute Economic Growth

Growth rate of GDP = [GDP(current
year) - GDP(prev. year)]/ GDP(prev.
year) 100
Formula used to compute Gross National
Product
GNP = GDP + Net factor income from
abroad
Where,
GDP = Gross Domestic Product
Net factor income from abroad = income earned in foreign

Ten Assessment Methods

1. Access to
Customers/Markets
2. Concentration of
Businesses & Services
3. Real Estate and
Infrastructure
4. Labor Market Factors
5. Municipal Permit Processes
6. Community Quality of Life
7. Site Related Amenities
8. Business Incentives
9. Local Tax Rates
10. Access to Local

Issues and problem

on economic
growth
Shadow
Economies
Rural Poverty in
Developing
Countries