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Economic Growth: Economic growth is the increase in the capacity of producing goods and services in an economy which is compared

from one period of time to another period of time. The economic growth is either measured in the nominal terms which include the inflation in it while it is also calculated in the real terms in which inflation is not included in the nominal terms. When we say that a country is gaining economic growth then this refers to the increase in the GDP of that country because when the production of goods and services increase then the GDP of a country also increases and so we say that a country is gaining economic growth. But the GDP has the following components which causes GDP to change. These determinants are Investment, Consumption, Government Expenditures and Net Exports and we can say that: GDP= I+C+G.E+NX( exports-imports) When the determinants of GDP increase, then this leads to the increase in the economic growth. These determinants of GDP increases due to the increase in the production of good and services and they both affect each other. Production includes the methods which are used to change the physical and intangible inputs such as raw material and ideas into goods and services. Production includes the following factors: 1) Land: It includes the natural resources which occur naturally and they are not created by man himself. Such as mines, oil fields, forests and earth surface etc. This factor is very important in the production process because the production of goods and services take place on the land because labor uses the capital on land for producing goods and services.

2) Labor
It is the factor of production which includes the efforts of the human beings for the production activities either in the form of physical efforts or mental efforts and these are used to make goods and services. All the people working in the production process comes under this factor and without that the efficient labor, production can be increased. 3) Capital: This factor includes the machinery and equipment which is used for the production purpose. It is very important because this helps in producing the goods and services directly and when there is more capital then more production can be achieved by employing more capital.

4) Entrepreneur: It includes the services of the person who manages the business, takes risk and makes investment in the business to earn profit and he also brings innovation in the business and due to which the working capacity of a business increases and the business produces more and more of a product and service.

Economic growth has a relation ship with production in either direct terms or indirect terms. But increase in the production of the goods and services causes a country to grow economically. When the factors of productions which are land, labor and capital increases the production increase as a result but this increase in the production also causes the increase in the investment and consumption and the exports due to which there is an increase in the GDP and we can say that when the GDP is more of a country, it is economically stable and it grows economically more with more and more productions. So the increase in the production ultimately causes the economic growth. But that is not to say that there is one way relationship between both because when the economic growth takes place then this causes the increase in the production as well. It means when a countrys production increases,

Human Capital:
Traditionally in economics, the capital was only treated as the physical capital but later on it was accepted that the capital is also invested in the form of human capital. On the basis of production functions the economists in the late 50s found that the standard measure of the labor and physical capital were not able to explain the post war growth sufficiently. Findings on the missing portion were diverse. Some schools of thought argued that the reason is in the lack of proper adjustment in the quality of the physical capital and technology while some said that the exclusion of the human factor is the reason and which is actually the investment on the laborers like educating them and providing them the facilities through which they can improve their skills and then this investment on the laborers actually helps in more production because of their abilities are increased to produce more and more and this leads to economic growth.

Sufficiently Speculations