Why does economic growth not necessarily lead to economic development?
You can have economic growth by having more people buying and selling. But that does not mean that everything will be better. You can still have people in debt to the banks because their investments failed. The economy does not progress because more people are employed. There is a difference between creating jobs and creating wealth. You need someone to think of a revolutionary idea to try to progress the economy. The government can also prevent economic development with corporations and bail outs. The government can also help economies develop by implementing (as proven) a progressive tax system and minimum wage. Keeping a middle class strong I very important. And then there is Globalization, which makes people from one country lose business to a cheaper country.
More economic growth is not necessarily better unless the benefits of growth:?
C. increase real GDP per capita that takes care of population and inflation rise both.
Why might economic growth not necessarily improve the well being of the average citizen?
Because it depends on how the cake will be distributed. It is called a trickle-down effect. There is two schools saying differently. One is, no cake,no distribution. That means, growth first, development later. The other is no equality, no growth. More over growth can be cheating. It can open the country for foreign investments and technology for exports. Income will increase only for people who have jobs. But the big part of the cake go to foreigners.
How does economic development affect population growth?
Economic development does impact population growth, but not necessarily in the way you might think. As the economy grows, and societies become more able to physically support excess population (above what is required to actually grow the crops), population growth has declined. This is because in most primitive societies, an additional child is another source of labor, and another hedge against the time when the parents cannot provide for themselves. This is the case in most primitive societies, where the parents who do not have many children cannot expect to have someone to support them in their old age. Once society shifts towards a more knowledge based economy, however, the investment required to make someone a contributing member of society increases, while at the same time, social safety nets reduce the dependence people have on their children during their old age. So as the economy grows, population also grows, but once a shift is made from a primarily agrarian economy to a more technologically focused one, the benefit of having additional children declines, and parents tend to invest more in a few offspring, rather than have a lot in the hopes that some will survive and take care of them. In some case, such as Japan and some parts of Europe, natural reproduction rates have fallen below that needed for the replacement of members.
What is the reason as to why economic development leads to democracy?
The questioner must been in coma for at least 50 years. Look at Vietnam and China. Economic developement has nothing to do with the type of government. It is ability of each respective government to set policies and regulations conducive to economic growth. Infrastructures, education the tax breaks to foreign investors etc to create jobs and later to upgrade skills and knowledge to stay competitive. The political systems had nothing to do with all these. It’s the political will to pursue the right policies, sometimes against disagreement from the old guards as in the case of Deng. These policies must give encouragement and incentives to the people to better themselves. China initally allowed her citizens to keep part of what they produced for themselves. When Deng Xiao Ping experimented with the open door policy he did so without having to follow Western political system. As China develop free enterprise and capitialism replaced controlled economic planning , little did she realised the accelerated pace the economy developed. Growth to GDP was in double digits,FDIs were highest in the early years. State enterprises that are not profitable were closed. Vietnam suffered devastation after the war. She did not follow democratic form of government and yet she enjoyed high economic growth,even today. In fact N Korea was doing well before the collapse of the http://USSR. Look at Taiwan , the new policies especially on labor are confusing at best. All the speeches will not bring imptovement if the wrong policies are implemented. Taiwan is supposedly democratically run. The current president is more interested in vendettas and showing her face for tv crew than in actually doing her job. It all comes down to the right approach and policies of each respective and responsible government, be it a socialist, communist or a democratic type.
Is GDP a good measure of economic growth? Why or why not?
GDP is the final value of goods and services produced in a country. To measure its effectiveness as a measure to describe an economy's indicator, one must look both at its advantages and disadvantages and also the possible alternatives.Advantages:Using GDP as a measure of a nation's economy makes sense because it's essentially a measure of how much buying power a nation has over a given time period. GDP is also used as an indicator of a nation's overall standard of living because, generally, a nation's standard of living increases as GDP increases.Disadvantages:1. It doesn't count unpaid volunteer work.2. Wartime disaster increase the GDP of the country.3. It doesn't show the distribution of income among different people.4. It doesn't show whether people belonging to a country having high GDP are happy or not.5. It does not account for quality of goods.If you measure India's GDP, it is the 10th richest country but this measure also does not take into account the purchasing power of people. By measuring GDP with respect to purchasing power parity, India becomes the 3rd richest in the world.But then again, this measure has its drawbacks. One can't say for sure what all goods should be included to calculate it.Human Development Index that can be used to measure economic progress. It uses statistics like life expectancy, education and income levels to measure a country's progress but then again it has its drawbacks like failure to include any ecological considerations, lack of consideration of technological development or contributions to the human civilization, focusing exclusively on national performance and ranking, lack of attention to development from a global perspective, measurement error of the underlying statistics, and on the UNDP's changes in formula which can lead to severe misclassification in the categorisation of 'low', 'medium', 'high' or 'very high' human development countries.Bhutan uses yet another measure as an indicator. It is the Gross happiness Index which measures the happiness level of people in an economy. As cheesy as it might sound, it is very difficult to calculate something as qualitative as happiness.That leaves us with just one measure i.e GDP.Even though we are all well aware of its shortcomings, we don't really have a choice simply because it is the only thing that can be precisely calculated and can be used as a measure to compare economic progress of various countries.
What is take off stage in economic development?
This is rather a rehtoric and uses an aeronautical analogy to descrive how countries remain economicall dormnt for long and moves along the a stagnant situation and then runs fast to take the aircraft take off from the ground of low level of stagnation and then gain flight in a rising slope and then in a falling slope at a higher level of flight. The Rostovian take-off model (also called "Rostow's Stages of Growth") is one of the major historical models of economic growth. It was developed by W. W. Rostow. The model postulates that economic modernization occurs in five basic stages, of varying length. Traditional society Preconditions for take-off Take-off Drive to maturity Age of High mass consumption Rostow asserts that countries go through each of these stages fairly linearly, and set out a number of conditions that were likely to occur in investment, consumption and social trends at each state. Not all of the conditions were certain to occur at each stage, however, and the stages and transitions periods may occur at varying lengths from country to country, and even from region to region. Rostow's model is one of the more structuralist models of economic growth, particularly in comparison with the 'backwardness' model developed by Alexander Gerschenkron. The two models are not necessarily mutually exclusive, however, and many countries seem to follow both models rather adequately. Beyond the structured picture of growth itself, another important part of the model is that economic take-off must initially be led by a few individual sectors. This belief echoes David Ricardo’s comparative advantage thesis and criticizes Marxist revolutionaries push for economic self-reliance in that it pushes for the 'initial' development of only one or two sectors over the development of all sectors equally. This became one of the important concepts in the theory of modernization in the social evolutionism. Take-off then occurs when sector led growth becomes common and society is driven more by economic processes than traditions. At this point, the norms of economic growth are well established. In discussing the take-off, Rostow's is a noted early adopter of the term “transition”, which is to describe the passage of a traditional to a modern economy. After take-off, a country will take as long as fifty to one hundred years to reach maturity.