How Can Economic Development Be Measured?

Economic Development can be calculated using a number of different dynamics such as taking into account the Gross Domestic Product (GDP), or the Gross National Product (GNP) albeit the former method of GDP is more commonly used throughout the world, with even the United States deciding to start using GDP as far back as 1991, so as to more accurately compare its growth against other countries, as prior to this it was solely using GNP.

Through the method of measuring a country's economic development it can be possible to accurately estimate the quality of life experienced by the same country's inhabitants, and in turn make comparisons between different countries.

The independent, not for profit, information verification website at www.factcheck.org determines GDP as the total market value of services and goods produced within the borders of a country, regardless of nationality, whereas GNP takes into consideration all services and goods produced by the country's residents regardless of where they live.

There are a number of significant drawbacks in using GDP to gauge a country's economic development, for instance, in some cases where a substantial percentage of GDP is owned by a small percentage of the population, the overall economic development may be on the decline or standing still when GDP would suggest the opposite.

In a similar vein, the GDP will not take into account the black market economy, which by its nature cannot be measure, so could actually skew the figures the other way and underestimate the standard of living of that particular country. It is for this reason that other aspects must be considered when gauging the development of an economy: The purchasing power of the currency, population growth including birth rates and life expectancy, unemployment figures, education statistics and urbanisation are just some of the areas that can be viewed when analysing whether a country is developing economically.

    Some of the indicators of economic development are as follows:
·   GDP per capita which is the total value of goods produced in the country divided by the population
·   Life expectancy which is and indirect measure of food supply, health facilities etc
·   Literacy rates that shows the ability of the labor force
·   Measures of poverty both relative and absolute poverty
·   Human development index
·   Economic activity per sector
·   Unemployment

Economic development can be measured in many ways but first of all it is important to point out that an economy can grow without developing. Development is a qualitative measure of an improvement in the quality of life.
It can be measured by GNP and GDP per capita, by measuring birth rates and literacy rates, by measuring life expectancy, urbanisation, energy consumption, population growth and distribution of income.
All of these terms can be found on the net if you have trouble finding them write again and ill explain it,

There are various indicators of economic development and these indicators are also used to distinguish between the developed and the underdeveloped economies. The first indicator of economic development is GDP per capita. It is the value of goods and services produced in an economy. The second factor is literacy rate.  Some other factors include life expectancy, measures of poverty, employment rate, demographics indicators, disease indictaors and trade balance etc.