Question

Why is the quest for economic growth and development complicated?

Answer 1

Economic Growth is a quantitative measure that measures the growth in macroeconomic parameters of the economy. It is measured by change in GDP or GDP growth rate, change in capital stock, change in investment etc.

Whereas economic development is a qualitative measure that includes a change in both economic and non-economic parameters (environmental). It measures the distribution of economic resources between different sections of the society, it measures the impact of economic activities on the environment, it measures how sustainable is the growth,

It is measured as GDP per capita, Income inequality ratio, Happiness index, Health index etc.

The problem arises because of difficulty in measuring economic development accurately. And it is important to measure economic development to know whether economic growth is leading to economic well being or not.How to approach economic growth so that it leads to economic development is the main problem. Economic growth is attained by a capitalist economy which does not take care of poor people.