Growth and Development

A country’s growth and development are often measured by several economical parameters. Such parameters such as GDP, HDI, Human Poverty Index, help determine a country’s growth as well as development. Development can be reflected by the progress of human lives and quality as well; such as decreases in inequality, unemployment etc. therefore, both growth and development are the important measurements in a country, as based on that government can make new schemes and policies to boost their economies of retirement.

Definition of growth and development in economics

Economic growth is the increase of national income or national output, regarding economic goods and products compared to one form another time. On the other hand, economic development means long term economic growth, such as a country having an increased rate of income. Healthcare, gender equality, can be addressed in developed countries or the developed economy. 

Difference between economic growth and economic development

Economic growth consists of various processes in per-capita income and national income increasing process. Apart from economic growth, economic development is a much wider concept that includes social, political, cultural changes and overall development in literature, gender and other phenomena. 

Several factors are related to economic growth such as gradual positive changes in GDP, product consumption, spending investment of the government and net exports. On the other hand, economic development is related to the growth of human health, increases inequality and equity, and quality of life along with purchasing power parity and so on. 

Economic growth can be measured by several quantitative factors for example GDP, PPP, whereas development can be measured by the HDI, HPI, literacy, infant mortality etc. 

Principles of economic growth and development 

Several principles factor that affects economic growth and development are

Natural resources: Natural resources such as land, drainage systems, mines are some factors that affect economic growth and development. Mercantilism is started here, which defines that the wealth of a country such as gold, trade surplus can increase the growth. 

Capital formation Adam Smith’s theory mentioned the role in increasing return to economic scale. Capital formation is determined by workers’ activity and savings, where the saving can be speed on occurring other goods to formulate more capital. 

Human resource: neo-classical model is based on human resource labour productivity, workforce size and factor inputs, where it determines the effective and skilled labour can increase the rate of growth and productivity. The more skilled the more advanced development occurs in a country in terms of technology, health etc. 

Population growth: population growth is a positive phenomenon of underpopulated countries but as perMalthusian’s theory excessive population can create food and product scarcity. 

Determinant of economic development in India

National Income and Per-Capita Income

National income and Per-capita income are the traditional approaches for measuring economic development. National incomes are defined as the value of products produced in a country in a financial year. In India, the GNP (Gross National Income) is Rs. 8.82 Lakh Crs. Additionally, the per capita is Rs. 150 thousand. As per the c; classification of WDR (World development Report) India falls under middle-income countries. 

IHDI, HDI and GII

IHDI (Inequality-Adjusted Human Development Index), HDI (Human Development Index) and GII (Gender Inequality Index), India has ranked 100 out of 144 countries, 135 out of 187 countries and 127 out of 187 countries. These determine that India is still in into stages of development and need to sustain more equality, women empowerment, minimise gender discrimination, health improvement etc. 

The time when economic growth and development occurs 

Economic growth in a country occurs if a country finds new minerals or natural resources, increases in workforce qualitatively, increases in machinery and critical systems and with the advancement of technology. Similarly, economic development occurs, when a developing country, for example India, gains an increase in PPP, and GDP, IHDI, HDI and GII. Additionally, if India advances in literacy and educational levels, improves quality in household and amenities, improves the environmental aspect and sustainability and increases life expectancy, there is a possibility to gain economic advantages. 

Concept of GDP and its role as an indicator 

GDP (Gross Domestic Product) is a standard measure amongst value-added production thereof chase of services and goods in a country. Currently, the GDP of India is 7.8% in the year 2022. GDP helps to detect the value-added prices in every stage of production, whereas the expenditure adds up to the value of purchasing and the income is summed up with the incomes that are generated by production. GDP is a good economical measurement but has some limitations as it cannot measure underground or hidden taxes, household production etc.

Conclusion

The growth and development in literacy rate, life expectancy and infant mortality rate, purchasing power, and per capita incomes can determine the levels of development and also provide future recommendations where the country is lacking and what improvement is needed.