'Economic Growth is a Necessary but not Sufficient Condition of Economic Development"
Economic growth and economic development are often thought to be synonymous but although the two are closely linked, there are crucial differences in their meanings. Economic growth is defined as 'a rise in the total output (goods or services) produced by a country'. It is measured by the percent rate of increase in the gross domestic product (GDP). Economic development as defined by Todaro is "not purely an economic phenomenon but rather a multidimensional process involving reorganization and reorientation of entire economic and social system".
Economic growth measures growth in monetary terms and looks at no other aspects of development. Economic development looks at increase in productivity while taking into account factors like economic, social and political issues. Very often economic growth in a nation does not bring about economic development. Economic growth of a nation can also be accompanied by increase in poverty and growing levels of unemployment. This type of growth if not accompanied by economic development in the long term is bound to have adverse affects on society. Not only does it affect people, it also has a negative impact, as to maximize profits, the environment is callously polluted. Economic growth can take place if there is efficient use of people's knowledge and capability and good government policies.
Development is a long-term process. It looks into all aspects of growth, taking into account factors like the environment and human needs. Economic growth can only take place in the long run if there is development simultaneously. Sustainable development is defined as the world bank as "development that meets the needs of the present without comprising the ability of future generations to meet their own needs". This sort of development is important as it means the best possible use of our available resources without jeopardizing the...
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