Looking for Previous Year IAS Papers? Download now free!
You will be auto-sent a link to download the IAS Past Papers & Model Papers when you join the IAS Free Training Group

Home | Downloads | Careers | Books |IAS Online TutorialsIAS online Tutorials | Advertise Advertise| Contact Us | About Us | ForumForum| Link to usLink to us
Login Friday, July 1, 2022

IAS Resources
About IAS
IAS Preparation
IAS Careers
IAS Syllabus
IAS Online Tutorials
IAS Free Online Exam
Indian Forest Service
Indian Engineering Service
Indian Foreign Service
Indian Police Service
Record and Opinion
Books and Links
Free Downloads

 Home » Tutorials » Economics » Economic Growth and Development

Economic Growth and Development


Growth Rate

Economic Development

Some economists hold a view that the economic development is not much different from economic growth. For them, both are processes of long-term increase in per capita income. Some other economists believe that development is distinctly different process than growth and covers other dimensions of change besides growth. Still others hold that, development is nothing but the level of per capita income achieved in a particular year.
(more content follows the advertisement below)

Whole human history may be thought of as a succession of developments or changes, largely in positive direction. Looking from a distance, we find that production structure of the economy has changed: from hunting-gathering to settled agriculture, from agriculture to manufacturing, from manufacturing to automatic production, from production of goods to production of services. It does not mean services were not produced, say thousand years ago; it only means that its relative importance has changed and that this might have occurred with increase in all activities in a broad sense.

However, economics takes most of its lues from the economic history of the West during the last two centuries or so. During this period, a variety of sweeping changes took place in Europe, which may broadly be categorized as technological and institutional. Early economists working in the field of development economics took notice of change in the composition of output and deployment of labour in activities. They called it structural change. Structural change meant relative increase in terms of proportion of non-agriculture/nonprimary output and concomitant changes in proportion of employment of labour in non-agricultural activities (and also in that of allocation of capital and land). However, this structural change has to take place along with increase in output of all (or majority of) goods, not with decrease. They defined economic development as economic growth with structural change in favour of nonagricultural activities. And structural change was understood in terms of composition of GDP and industrial distribution of labour. This was a reflection of changing demand for goods and services on the one hand and changing demand for labour by production technology in different sectors on the other. Most of the mainstream economists believed that all economies in the West traversed the same path and believed that other economies would also follow the same path. When they did not find it happening they pointed out that institutional changes are equally important. Institutional changes could mean emergence of new institutions in governance, as also in capital market and money market. Some pointed out necessity of attitudinal changes in people – a leap from traditional value system to modern value system. In order to accommodate this thought, economic development could be defined as economic growth plus, that is, something more than economic growth. There were attempts to emphasize technological dimension of development. It was pointed out that economic growth should be accompanied by rise in productivity. Then, we could define economic development as economic growth accompanied by rise in productivity.

Development is, however, just not concerned with description of economic history. It is to be pursued as a deliberate mechanism of deliverance of the masses from poverty and idleness in a relatively short period of time. Developments in the fifties and sixties did not perceptibly change the scene in these crucial areas. Many economists felt disillusioned and started showing their anguish. One such Western economist who had been dealing with problems of development asserted in a World Conference in Delhi: “The questions to ask about a country’s development are: What has been happening to poverty? What has been happening to unemployment? What has been happening to inequality? If all three of these have declined from high levels, then beyond doubt this has been a period of development for the country concerned. If one or two of these central problems have been growing worse, especially if all the three, it would be strange to call the result ‘development’ even if per capita income doubled.”

Indeed, here is a reference to conscious attempts made to develop an economy by adopting a strategy. If the strategy brings in growth in capacity to produce more and in actual output, transformation in structure of economy in terms of composition of output of goods and services or even in deployment of labour force, emergence of institutions in terms of variety of banks, and technology making use of machines and power instead of men and cattle, but makes no significant dent on basic problems of underdeveloped countries, what use are the efforts or the strategy? This implies that development has to be related to welfare of people. It was suggested much earlier that welfare of people depends on the size of the cake as well as its distribution. One is entitled to one’s wages when one is employed. One should get adequate wages, if employed or should get remunerative prices for what one produces, if self-employed. Mass poverty was one particular problem we attributed to the colonial rule and wanted to secure self-governance in order to eradicate it. If that scourge still persists on a large scale, we have a cause to worry about. In short, the suggestion is that the income should get redistributed in favour of relatively worse-off. Keeping this in view, some economists prefer to define economic development as economic growth with redistribution of resources in favour of the relatively worse off. In this concept, it is believed that reduction in inequality will reduce poverty and will lead to reduction in unemployment too.

Discussion Center



Feedback/ Suggestion

Yahoo Groups

Sirfdosti Groups

Contact Us

Members Login Here!

Forgot Password?
New User? Register!
Toppers View

Get 9,000+ Interview Questions & Answers in an eBook. Interview Question & Answer Guide
  • 9,000+ Interview Questions
  • All Questions Answered
  • 5 FREE Bonuses
  • Free Upgrades


IAS Exam, IAS 2022, IAS 2023 Training, IAS 2021 Papers and Solutions, IAS Preparation & Related Pages

IAS Forum | Civil Services | IAS Overview | How to Prepare for IAS | IAS Eligibility Criteria | IAS Exam Pattern | IAS Exam Syllabus | IAS Application Form Centers | Sections Under IAS Examinations | Postings of an IAS Officer | Method of Making Notes | Style of Answering Questions | Time Management | IAS Regulations | Cut off Marks in IAS | Training Institutes for IAS | IAS Tips | Time Table for IAS 2022 Exam | Calendar for IAS 2022 Exam | Top Scorers in IAS Exam | Post Offices for IAS Exam Form | Sample IAS Exam Paper | IAS Current Affairs | Career in IAS | Jobs Offered in IAS | Nature of Work | Interview Tips for IAS | Interview Techniques for IAS | IAS Syllabus | IAS Preparation Strategy | IAS Model Notification | Daily / Periodicals for IAS | Art and Craft | IAS Tutorials | IAS Tutorials for Agriculture | IAS Tutorials for Animal Husbandry & Veterinary Science | IAS Tutorials for Botany | IAS Tutorials for Chemistry | IAS Tutorials for Economics | IAS Tutorials for Essay | IAS Tutorials for Geography | IAS Tutorials for Geology | IAS Tutorials for Indian History | IAS Tutorials for Physics | IAS Tutorials for Psychology | IAS Tutorials for Sociology | IAS Tutorials for Zoology | Previous Years Test Papers for IAS | IAS Mock Exam | Current Affairs for IAS | IFS - Indian Forest Services | IFS - Indian Forest Services Examination Plan | IFS - Indian Forest Services General Instructions | IFS - Indian Forest Services - List of Head Post Offices | IFS - Indian Forest Services Special Instructions | IES - Indian Engineering Service | IES - Indian Engineering Service Model Notification | IES - Indian Engineering Service General Instructions | IES - Indian Engineering Service Examination Plan | IFS - Indian Foreign Service | IFS - Indian Foreign Service - Selection & Training | Career in IFS - Indian Foreign Service | IPS - Indian Police Service - Modern Ranks and Rank Badges | IPS - Indian Police Service in History | IPS - Indian Police Service - External Resources | Reward of Brilliance | Deputation | Civil Lines | IAS Toppers Opinion | Renumeration in IAS | AKHAND PRATAP SINGH - IAS Topper | Anay Dwivedi - IAS Topper | Anupama - IAS Topper | D DIVYA - IAS Topper | Divyadharshini - IAS Topper | Divyadharshini Shanmugam - IAS Topper | Dr Sumit Seth - IAS Topper | GAGAN - IAS Topper | Garima Mittal - IAS Topper | GARIMA MITTAL - IAS Topper | Iqbal Dhalibal - IAS Topper | Iva Sahay - IAS Topper | JAI PRAKASH MAURYA - IAS Topper | Karthik Adapa - IAS Topper | Mangesh Kumar - IAS Topper | Manish Ranjan - IAS Topper | Muthyala Raju Revu - IAS Topper | Nila Mohan - IAS Topper | Pankaj Dwivedi - IAS Topper | PC Vinoj Kumar - IAS Topper | Prasad Praladh Akkanouru - IAS Topper | Prince Dhawan - IAS Topper | R V Varun Kumar - IAS Topper | RAVI DHAWAN - IAS Topper | Roopa Mishra - IAS Topper | Rukmani Riar - IAS Topper | SASWATI DEY - IAS Topper | Saswati Dey - IAS Topper | Shah faesal - IAS Topper | Shena Agrawal - IAS Topper | Sorabh Babu Maheshwari - IAS Topper | Sweta Mohanty - IAS Topper | TANVI SUNDRIYAL - IAS Topper | Vijayalakshmi Bidari - IAS Topper | IAS Books | SSC Exam Pattern | CDSC Exam Pattern | NDA Exam Pattern | GA - General Awareness Exam Pattern | PG - Post Graduate Exam Pattern |
Copyright © 2022. One Stop IAS.com. All rights reserved Privacy Policies | Terms and Conditions | About Us
Our Portals : Free eBooks | Interview Questions | IndiaJobForum | Free Classifieds | Vyoms | One Stop FAQs | One Stop GATE | One Stop GRE | One Stop IAS | One Stop MBA | Free SAP Training | One Stop Testing | Web Hosting | Sirf Dosti | Your Project Code | Cook Book Global | Tests World | Clean Jokes | Vyom | Vyom eBooks | Vyom Links | Vyom World | Shayari | C Interview Questions | C++ Interview Questions | Send Free SMS | Placement Papers | SMS Jokes | CAT 2022 Notification