ECONOMIC GROWTH AND ECONOMIC DEVELOPMENT: DIFFERENCES
Economic Growth is defined as the rise in the money value of goods and services produced by
all the sectors of the economy per head during a particular period. It is a quantitative measure
that shows an increase in national income or per capita income. Economic growth can be
expressed in terms of gross domestic product (GDP) and gross national product (GNP) that helps
in measuring the size of the economy.
Economic Development is defined as the process of increase volume of production along with
the improvement in technology, a rise in the level of living, institutional changes, etc. In short, it
is the progress in the socio-economic structure of the economy. It is a multidimensional process
involving major changes in social structures, popular attitudes, and national institutions, as well
as the acceleration of economic growth, the reduction of inequality, and the eradication of
poverty.
It considers the overall development in an economy regarding the standard of living, GDP, living
conditions, technological advancement, improvement in self-esteem needs, the creation of
opportunities, per capita income, infrastructural and industrial development and much more.
The fundamental differences between economic growth and development are explained
in the points given below:
Economic growth is the positive change in the real output of the country in a particular
span of time economy. Economic Development involves a rise in the level of production
in an economy along with the advancement of technology, improvement in living
standards and so on.
Economic growth is a quantitative concept while economic development is a qualitative
concept.
Economic growth is one of the features of economic development.
Economic Growth is considered as a single dimensional in nature as it only focuses on
the income of the people of the country. Economic Development is considered as a
Multidimensional phenomenon because it focuses on the income of the people and on the
improvement of the living standards of the people of the country.
Economic growth is an automatic process. Economic development is the outcome of
planned and result-oriented activities.
Economic growth enables an increase in the indicators like GDP, per capita income, etc.
On the other hand, economic development enables improvement in the life expectancy
rate, infant mortality rate, literacy rate and poverty rates.
Economic growth can be measured when there is a positive change in the national
income, whereas economic development can be seen when there is an increase in real
national income.
