Economic growth and economic development are often used interchangeably, but they are actually two different concepts.
Economic Growth
Economic growth is a quantitative measure of the increase in the production of goods and services in an economy over time. It is typically measured by the growth rate of the Gross Domestic Product (GDP) which is the total market value of all final goods and services produced in a country in a given year.
Economic Development
Economic development is a broader concept that encompasses not just the growth of the economy, but also the improvement in the quality of life of the people in a country. This includes factors such as poverty reduction, improved education and healthcare, and a more equitable distribution of income.
Here’s a table summarizing the key differences between economic growth and economic development:
Economic growth is a necessary condition for economic development, but it is not sufficient. A country can experience economic growth without experiencing economic development if the benefits of growth are not shared equally by all members of society. For example, if a country’s GDP grows rapidly but all of the gains go to the wealthy, the poor will not see any improvement in their standard of living.
