Table of Contents
- 1 Difference between Economic Growth and Development
- 2 How can we differ among Economic Growth and Development
- 3 What is the difference between Economic Growth and Development? Define Economic Development and explain its various elements.
- 4 Define the main elements of Economic Development.
- 5 “Economic development is a process whereby an economy’s real national income increases over a long period” Explain?
- 6 Level: Easy, Intermediate or BA Level
- 7 According to Mair & Baldwin
- 8 According to Kindle Berger
- 9 Elements of Economic Development
- 10 Economic Development in a Process
- 11 Other Economics Material on DarsoTadrees
- 12 Share to Social Networks:
- 13 Support Dars-o-Tadrees
- 14 You may also read the following posts:
Difference between Economic Growth and Development
How can we differ among Economic Growth and Development
What is the difference between Economic Growth and Development? Define Economic Development and explain its various elements.
Define the main elements of Economic Development.
“Economic development is a process whereby an economy’s real national income increases over a long period” Explain?
Level: Easy, Intermediate or BA Level
Generally both the terms “economic development” and “economic growth” are used in the same sense, but according to some economists, there are few differences between both.
Economic growth means an increase in output per unit of input. if the rate of output is higher than the rate of input, we can say that our production is increasing or our economic growth is increasing.
Economic development means changes in the structure of economy and changes in the sociological, cultural, political and in the administrative setups.
Growth and Development go side by side, so economic development is growth plus changes.
According to Mair & Baldwin
“Economic Development is the process whereby an economy’s real national income increases over a long period of time and if the rate of development is greater than per capita, real income will increase”
According to Kindle Berger
“Economic development implies both more output and changes in the technical and institutional arrangements by which it is produced and distributed”
Elements of Economic Development
Important elements of economic development, contained in the various definitions of economic development, are as under:-
Economic Development in a Process
Economic development is a process which brings many changes and due to these changes, national income increases. There are two types of changes:-
- Changes in Supply Sector
- Discovery of Additional Resources. New resources like Coal, Gas and Oil can be discovered under the process of economic development which are very useful for the economic development.
- Increase in Capital Accumulation. Under the process of economic development, rate of investment and rate of production increases, which indicates that economy is on the path of development.
- Population Growth. In the process of economic development, rate of population growth begins to fall and per capita income of the economy starts increasing.
- Introduction of Better Technologies. In the process of production, new machines and latest technology in introduced which improves the quality and quantity of the product.
- Improvement in Skill. We can also find the technical skill in the manpower as economic development takes place. Skilled and qualified labor increases which helps in boosting the economy.
- Changes in the Institutional Arrangements. Under the process of economic development, we can also find some changes in the institutional arrangements. Democratic institutions are established and people begins to think on democratic lines. We may also find a positive change in the political structure of the economy. People participation in economic affairs also increases.
- Changes in Demand Sector
- Age Composition of Population Changes. As the development process starts, the earning and independent age groups of population increases, while dependent age group population falls.
- Level of Income Increases. The level of national income also increases with the development which is the main indicator for economic development.
- Distribution of Income. The methods of income distribution changes and all the factors of production (land, labor, capital and entrepreneur) get the proper reward.
- Changes in Likes & Dislikes. Under the process of economic development, the likes and dislikes of the people changes. We may analyse early in various countries, even there is a change in eating and drinking.
- Higher Rate of Development. It is necessary that rate of development should remain higher than the rate of population growth and this ensure the decrease in population growth and higher rate of development.
- Increase in Real Income. Under the process of economic development, real national income and per capita income increase over a long period of time. In the short period, fluctuations may occur in the economy but in the long run, there should be persistent rise.
- Reduction in Poverty. Due to economic development, there should be a reduction in poverty. If there is no reduction of mass poverty then there is no development.
- Provision of Basic Necessities. Food, housing, health and clothing facilities should be available to the people in the economy. If there is no improvement in these facilities then it cannot be called economic development.
- Participation of the People. There should be greater participation of the people in making decisions for improving the welfare. Without active participation of the people economic development is not possible.
- Organization of the Economy. Economy is organized in such as manner which increases production and employment for the public. If it cannot generate the employment and production then it cannot be called economic development.
Other Economics Material on DarsoTadrees
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