Economic growth is the increase in the amount of the goods and services produced by an economy over time. It is conventionally measured as the percent rate of increase in real gross domestic product, or real GDP. Growth is usually calculated in real terms, i.e. inflation-adjusted terms, in order to obviate the distorting effect of inflation on the price of the goods produced. In economics, "economic growth" or "economic growth theory" typically refers to growth of potential output, i.e., production at "full employment", which is caused by growth in aggregate demand or observed output.
As an area of study, economic growth is generally distinguished from development economics. The former is primarily the study of how countries can advance their economies. The latter is the study of the economic aspects of the development process in low-income countries.
As economic growth is measured as the annual percent change of gross domestic product (GDP), it has all the advantages and drawbacks of that measure.
Read more about Economic Growth: Institutions and Growth, Human Capital and Growth, Inequality and Economic Growth, Quality of Life, Negative Effects of Economic Growth, Prominent Growth Economists
Famous quotes containing the words economic growth, economic and/or growth:
“Economic growth may one day turn out to be a curse rather than a good, and under no conditions can it either lead into freedom or constitute a proof for its existence.”
—Hannah Arendt (1906–1975)
“The economic dependence of woman and her apparently indestructible illusion that marriage will release her from loneliness and work and worry are potent factors in immunizing her from common sense in dealing with men at work.”
—Mary Barnett Gilson (1877–?)
“Although its growth may seem to have been slow, it is to be remembered that it is not a shrub, or plant, to shoot up in the summer and wither in the frosts. The Red Cross is a part of us—it has come to stay—and like the sturdy oak, its spreading branches shall yet encompass and shelter the relief of the nation.”
—Clara Barton (1821–1912)