Tag: economic growth and development

Economic growth is measured by per capita income, which adjusts the total national income by dividing it by the population to account for changes in the number of people sharing that income.

Economic growth refers to the process of using natural resources for the development of the economy in order to increase the per capita income of the economy. The growth mainly measures the per capita income rather than the overall income of the economy. 

Simon Kuznets was one of the earliest writers on the development of the economies where economic development refers to the development and growth of the economy in all terms which includes all aspects and has become a main and central theme of economic thought throughout the years. 

GDP and GNP are measures of total national output. Without accounting for population growth, an increase in these figures does not necessarily mean that the average citizen is better off, so they are not sufficient indicators of economic growth on their own.

The primary focus of economic growth is the increase in per capita income, which serves as a proxy for the average standard of living.

National Income refers to the income of the whole economy including all the sectors at a given point of time. It only estimates the income of all the sectors and does not say the exact figure as it is impossible to tell the exact income figure of an economy. Therefore, national income is only the imputed figure of the income of the economy. Economic growth of any nation is measured in national income aggregates of that nation.

Before the 1970s, economic development was largely viewed through a narrow lens of economic indicators like GDP growth. The 1970s marked a shift toward more multidimensional views including social and human development.

Economic development is considered multidimensional because it involves improvements in health, education, infrastructure, and social equity, rather than just an increase in economic output.

The 'redistribution with growth' approach emerged as a modern critique of earlier models, emphasizing that growth must be accompanied by policies that ensure the benefits are shared across the population.

The traditional approach to economic development focuses primarily on quantitative metrics, specifically the growth of real per capita income. It contrasts with modern approaches that incorporate qualitative indicators like poverty and inequality.