Economic Growth Is Important + Case Study
Economic growth
Paul. A (2001, pp.568) states that economic growth is a positive change in the level of production of goods and services by a country over a period of time.” This means that economic growth occurs when there is an increase in the levels of output for production and services. It is brought by technological innovation and positive external forces and can also be seen as a term to indicate the GDP growth.
The economic growth is measured by percentage change in GDP (Gross domestic production). Michael. B (2001, pp.20) states that the “Gross domestic product is the sum off net sales within a geographic location during a period of time. GDP is sum of value added, created within a given geographic period of time and GDP as sum of factor incomes earned from economic activities within a geographic location during a period of time.” Basically, GDP is the sum of net sales (final sales), value added (transformation of raw materials to finished goods) and income (earned within a countries border) by residents and non-residents, within a given geographic location during a period of time.
GDP is measured using the formula:-
GDP= C [consumption] + I [Investments] + G [Government spending] + (X [exports]) – M [imports]).
John. S (2003, pp.384) says that “there are two types of economic growth and to better understand, they must be distinguished”. They are the potential growth and the actual growth. “Actual growth is the percentage annual increase in national output: the rate of growth in actual output”. “Potential is the speed at which the economy could grow. It is the percentage annual increase in the economy’s capacity to produce: rate of growth in potential output.”
FOUR WHEELS OR FACTORS OF AN ECONOMIC GROWTH
The four wheels of economic growth are those factors or causes of economic growth. The four wheels or factors of growth are:-
Human resources
The human resources include labour supply, education, discipline and motivation. Labour inputs
Paul. A (2001, pp.568) states that economic growth is a positive change in the level of production of goods and services by a country over a period of time.” This means that economic growth occurs when there is an increase in the levels of output for production and services. It is brought by technological innovation and positive external forces and can also be seen as a term to indicate the GDP growth.
The economic growth is measured by percentage change in GDP (Gross domestic production). Michael. B (2001, pp.20) states that the “Gross domestic product is the sum off net sales within a geographic location during a period of time. GDP is sum of value added, created within a given geographic period of time and GDP as sum of factor incomes earned from economic activities within a geographic location during a period of time.” Basically, GDP is the sum of net sales (final sales), value added (transformation of raw materials to finished goods) and income (earned within a countries border) by residents and non-residents, within a given geographic location during a period of time.
GDP is measured using the formula:-
GDP= C [consumption] + I [Investments] + G [Government spending] + (X [exports]) – M [imports]).
John. S (2003, pp.384) says that “there are two types of economic growth and to better understand, they must be distinguished”. They are the potential growth and the actual growth. “Actual growth is the percentage annual increase in national output: the rate of growth in actual output”. “Potential is the speed at which the economy could grow. It is the percentage annual increase in the economy’s capacity to produce: rate of growth in potential output.”
FOUR WHEELS OR FACTORS OF AN ECONOMIC GROWTH
The four wheels of economic growth are those factors or causes of economic growth. The four wheels or factors of growth are:-
Human resources
The human resources include labour supply, education, discipline and motivation. Labour inputs