Very often, when talking about the economy of a country or nation, it is remarkable how many people are confused or do not understand the difference between economic growth and economic development; However, this is not a cause for surprise, since both concepts may appear very similar to the naked eye, despite the fact that they describe different realities. Difference b/w Economic Development and Growth
If you have doubts about this topic or are simply looking for a little more information to expand your knowledge, keep reading, because below we will explain why development and economic growth do not mean the same thing.
ECONOMIC GROWTH Difference b/w Economic Development and Growth
This concept is somewhat less comprehensive than that of economic development. It refers to an increase in the level of real national production of a country, which could be caused by an increase in the quality of resources (due to improvements in education …), an increase in the quantity of resources and improvements in technology or other ways of adding value to the goods and services produced by each sector of the economy.
Economic growth is measured by taking the Gross Domestic Product (GDP) as an indicator. It is nothing more than the percentage increase in GDP in one year. In this sense, it does not take into account the size of the informal economy; Also known as “black economy”, in this case the exploitation of natural resources is not considered, which could lead to pollution problems and diseases in the future.
Economic growth is a necessary but not sufficient condition for economic development to occur.
On the other hand, this is a normative concept that applies more to the moral sense of people (good-bad). Some theorists define economic development as an increase in the standard of living, improvements in self-esteem, greater freedom and social well-being.
The most accurate way to measure economic development is through the Human Development Index, which takes into account different rates and life expectancies that affect productivity.
This factor favors the creation of more opportunities in the education sector, health care, jobs and preservation of the environment. Economic development implies an increase in the per capita income of each citizen.
Finally, economic development is the most relevant measure of progress in developing countries; while economic growth is more important in developed countries. This last factor brings quantitative changes to the economy, but the first brings quantitative and qualitative changes.