Differences between Economic Growth and Economic Development






Economic Growth:
It is the quantitative measure which considers the rise in the output produced in an economy or nation in a particular period in its monetary value. The key parameters of economic growth in any economy are its Gross Domestic Product (GDP) and gross national product which helps in measuring the actual size of an economy.
example, we say GDP of India is 2.8 trillion USD and ranked 6th in globe whereas GDP of the United States of America is 19.3 trillion USD and ranked one.It shows how much the production of goods and services has increased compared from last year in a quantitative manner. It has many parameters to measure and few of them are human Resources. They are Natural Resource, Advancement in technology, Capital formation, Political and social economic factors.
Economic Development:
Economic development projects a broader picture of an economy which takes into account an increase in production level or output of an economy along with an improvement in the living standard of its citizens. It focuses more on socioeconomic factors rather than the just quantitative increase in production. Economic development is a qualitative measure which measures improvement in technology, labour reforms, rising living standards, broader institutional changes in an economy.
Human development Index (HDI) is apt tool to measure the real development in an economy.

Comparison between Economic Growth and Economic Development

Economic Growth
Economic Development
Definition / Meaning
It is the positive quantitative change in the output of an economy in a particular time period
It considers the rise in the output in an economy along with the advancement of HDI index which considers a rise in living standards, advancement in technology and overall happiness index of a nation.

Concept
Economic growth is the “Narrower” concept

Economic development is the “Broader” concept
Nature of Approach
Quantitative in nature
Qualitative in nature

Scope
Rise in parameters like GDP, GNP, FDI,FII etc.
Rise in life expectancy rate, infant, improvement in literacy rate, infant mortality rate and poverty rate etc.

Term / Tenure
Short term in nature
Long-term in nature

Applicability
Developed nation
Developing economies

Measurement Techniques
Increase in national income
Increase in real national income i.e. per capita income

Frequency of Occurrence
In a certain period of time
Continuous process

Government Aid
It is an automatic process so may not require government support/aid or intervention
Highly dependent on government intervention as it includes widespread policies changes so without government intervention it is not possible

Wealth Distribution
Economic growth does not emphasize on the fair and equal distribution of wealth/income among all its people.

It focuses on a balanced and equitable distribution of wealth among all individual and trie




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