Economic growth is a term generally measured by the amount a country or region produces over a certain period of time. While financial ministers may keep track of economic growth numbers every month, generally it is the quarterly and annual numbers that attract the most attention. In addition to production, measured through the gross domestic product, or GDP, local governments and individuals may use a different standard to measure economic growth.
If the GDP of a country one year is $100 billion US Dollars (USD) and the next year is $200 USD billion, then there has been economic growth of 100 percent. If, on the other hand, the GDP was only $90 USD billion, the growth would be negative 10 per cent. In most cases, it is still called economic growth, even if it is a contraction of the economy.
Economic development, on the other hand, refers to a sustainable increase in living standards. It implies increased per capita income, better education and health as well as environmental protection. Public policy generally aims at continuous and sustained economic growth and expansion of national economies so that ‘developing countries’ become ‘developed’. The economic development process supposes that legal and institutional adjustments are made to give incentives for innovation and investment so as to develop an efficient production and distribution system for goods and services.
If the GDP of a country one year is $100 billion US Dollars (USD) and the next year is $200 USD billion, then there has been economic growth of 100 percent. If, on the other hand, the GDP was only $90 USD billion, the growth would be negative 10 per cent. In most cases, it is still called economic growth, even if it is a contraction of the economy.
Economic development, on the other hand, refers to a sustainable increase in living standards. It implies increased per capita income, better education and health as well as environmental protection. Public policy generally aims at continuous and sustained economic growth and expansion of national economies so that ‘developing countries’ become ‘developed’. The economic development process supposes that legal and institutional adjustments are made to give incentives for innovation and investment so as to develop an efficient production and distribution system for goods and services.
