A Case Study on Akij Group of Companies

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Economic Development
vs
Economic Growth

Economic Growth is a narrower concept than economic development. It is an increase in a country's real level of national output which can be caused by an increase in the quality of resources (by education etc.), increase in the quantity of resources & improvements in technology or in another way an increase in the value of goods and services produced by every sector of the economy. Economic Growth can be measured by an increase in a country's GDP (gross domestic product). Economic development is a normative concept i.e. it applies in the context of people's sense of morality (right and wrong, good and bad). The definition of economic development given by Michael Todaro is an increase in living standards, improvement in self-esteem needs and freedom from oppression as well as a greater choice. The most accurate method of measuring development is the Human Development Index which takes into account the literacy rates & life expectancy which affect productivity and could lead to Economic Growth. It also leads to the creation of more opportunities in the sectors of education, healthcare, employment and the conservation of the environment. It implies an increase in the per capita income of every citizen. Comparison chart

| Economic Development| Economic Growth|
Scope:| Concerned with structural changes in the economy| Growth is concerned with increases in the economy's output| Growth:| 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| Growth relates to a gradual increase in one of the components of Gross Domestic Product: consumption, government spending, investment, net exports| Implication:| It implies changes in income, saving and investment along with progressive changes in socio-economic structure of country(institutional...
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