Economic
Growth is a narrower concept than economic development.It is an
increase in a country's real level of national output which can be
caused by an increase in the quality of resources (by education
etc.), increase in the quantity of resources & improvements in
technology or in another way an increase in the value of goods and
services produced by every sector of the economy. Economic Growth can
be measured by an increase in a country's GDP
( gross domestic product).
Economic
development is a normative concept i.e. it applies in the context of
people's sense of morality (right and wrong, good and bad). The
definition of economic development given by Michael Todaro is an
increase in living standards, improvement in self-esteem needs and
freedom from oppression as well as a greater choice. The most
accurate method of measuring development is the Human development
Index which takes into account the literacy rates & life
expectancy which affect productivity and could lead to Economic
Growth. It also leads to the creation of more opportunities in the
sectors of education, healthcare, employment and the conservation of
the environment.It implies an increase in the per capita income of
every citizen.
Economic
Growth does not take into account the size of the informal economy.
The informal economy is also known as the black economy which is
unrecorded economic activity. Development alleviates people from low
standards of living into proper employment with suitable shelter.
Economic Growth does not take into account the depletion of natural
resources which might lead to pollution, congestion & disease.
Development however is concerned with sustainability which means
meeting the needs of the present without compromising future needs.
These environmental effects are becoming more of a problem for
Governments now that the pressure has increased on them due to Global
warming.
Economic growth is a necessary but not sufficient condition of economic development.
