Difference between Economic growth & Economic Development
| Economic Growth | Economic Development |
|---|---|
| Economic growth refers to an increase in the real output of goods and Services in the country. . | Economic development implies changes in income, savings and investment along with progressive changes in socioeconomic structure of country |
| Growth relates to a gradual increase in one of the components of Gross Domestic Product: consumption, government spending, investment, net exports | Development relates to growth of human capital, decrease in inequality figures, and structural changes that improve the quality of life of the population |
| Economic Growth is measured by quantitative factors such as increase in real GDP or per capita income | The qualitative measures such as HDI Human poverty index (HPI), Infant mortality, literacy rate etc. are used to measure economic Development. |
| Economic growth reflects the growth of national or per capita income | Economic development reflects Progress in the quality of life in a country. |
Economic Development is measured by using
1. Human Development Index2. Gross National Happiness Index
3. United Nations world Happiness Index
Human Development Index:
Human Development Index is used to measure Economic development. Economic growth is different from Economic development.
Every year Human Development Index is released by United Nations Development Programme (UNDP)
The HDI is a measure for assessing progress in three basic dimensions of
human development:
1. a long and healthy life- Life expectancy
2. access to knowledge- Education
3. Access to a decent standard of living- Real Percapita income
2. access to knowledge- Education
3. Access to a decent standard of living- Real Percapita income
The Education component of the HDI is measured by two other indicators—
Mean of years of schooling (for adults aged 25 years)
Expected years of schooling (for children of school entering age)
Expected years of schooling (for children of school entering age)
Gross National Happiness:
Bhutan, a small Himalayan kingdom developed a new concept of assessing development in the early 1970s known as the Gross National Happiness (GNH).Bhutan has been following up the GNH since 1972 which has the following parameters to attain happiness/development:
- Higher real per capita income
- Good governance
- Environmental protection
- Cultural promotion (i.e., inculcation of ethical and spiritual values in life without which, it says, progress may become a curse rather than a blessing)
UN’s World Happiness Index
The Happiness report ranks nations on the basis of six key factors:(i) GDP per capita,
(ii) Healthy life expectancy,
(iii) Someone to count on,
(iv) Perceived freedom to make life choices,
(v) Freedom from corruption, and
(vi) Generosity
Some Important Questions
1. Which of the following organisation publishes Human Development Index?
a. IMF
b. World Bank
c. OECD
d. UNDP
a. IMF
b. World Bank
c. OECD
d. UNDP
2. Head Quarters of UNDP is located at
a. Washington
b. New York
c. Paris
d. Tokyo
a. Washington
b. New York
c. Paris
d. Tokyo
3. As per recent HDI report, what is the rank of India?
a. 130
b. 131
c. 100
d. 135
a. 130
b. 131
c. 100
d. 135
4. What is the present life expectancy in India as per HDI report?
a. 60 years
b. 55 years
c. 75 years
d. 68.3 years
a. 60 years
b. 55 years
c. 75 years
d. 68.3 years
5. Which of the following country measures Gross National Happiness Index?
a. India
b. USA
c. Bhutan
d. Japan
a. India
b. USA
c. Bhutan
d. Japan