Economic growth

Topics: Economic growth, Economics, Macroeconomics Pages: 5 (1574 words) Published: October 10, 2014
Economic growth is considered as one of the most essential parts of the economics, and it is defined an increase of goods and services of a country within certain period (Acemoglu, 2012). Modis (2013) claimed that, this economic growth conception particularly relates to the growth of potential output and production which is measured by gross domestic product per capita (GDP). Economic growth ideology has a long history, though it has been existed since the mid-18th, economic growth has dominated politics and policies since 1945 worldwide (Kallis et al, 2010). Indeed, Belasen et al (2012) mentioned that, economic growth conception merely exists in economics, and it is determined as the increase or development of goods, production, technology, and services. However, Ranis et al (2000) noted that, economic growth theory also concerns ecology, environment, social and moral values, and therefore it causes swift increase of human well-being. Due to mentioned controversial arguments for economic growth, the aim of this essay is to examine precisely the economic growth ideology and critically scrutinize it in terms of several aspects. This essay will argue about economic growth and it will reveal that, economic growth notion is the growth of output and income, increase of produced goods, rapid development of technology, and it is equally measured by GDP. Firstly, economic growth will be discussed in terms of economic aspect, it will reveal some limitations of GDP measurement such as exclusion of some economic activities (the costs of crime, growth of prisoners). In the next step, it will be examined from an environmental and ecological perspective and demonstrate some benefits for environment as well as preventing water scarcity with developed technology, some drawbacks for mankind such as air pollution and degradation of environment. In conclusion, on the basis of mentioned evidences, it will conclude that economic growth has slightly impact on the human well-being.

Starting with the analysis of economic growth notion from an economic perspective, growth of income and outcome, increase of productivity and services, decrease of unemployment, monetary value of goods, and markedly increase of technology are leading issues, indicated by GDP. The study of Bergh et al (2009) reveals that, GDP is an estimate of market throughput, equally measurement of output and income, and produced goods both by foreign and local companies. Renton et al (2012) claimed that, economic growth lead to the increase of economic force of state, as it increases production, develop technology and reduce unemployment. In order to increase economic force of state, the governments try to apply valuable economic system in countries (ibid). Marx (1858, cited by Xue, 2010: 20) who was first person stated capitalism term in economics, showed that capitalists were subject to an inevitable growth imperative. As, there is a competition among capitalists that is defined each individual capitalist increase his profit, and therefore nowadays capitalism system dominate worldwide. Furthermore, Costanza et al (2009) mentioned that, economic growth doe not only lead to high rate of employment or increase of output, but also it causes higher tax revenues for the government, thus it favors strength to government from an economic perspective, and GDP only measures only economic activity. To sum up, it seems that economic growth ideology impact on country`s economy, particularly it causes the increase of economic force of state.

However, certain scholars argue that economic growth also lead to people`s economic welfare that is called human well-being, at the same time it is measured by GDP. Firstly, According to McDonald et al (2010), human well-being conception relates to the quality of people`s life, their education and health quality. Shin (1978, cited by Xue, 2010: 21) reported that, many academics of different parts of the world appeared the importance of economic...
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