Question

Explain the difference between economic progress and economic development.

Answer 1

Instructions: We will compare the definition of economic growth and economic development and we will try to understand the similarities and difference between them.

Solution: While economic growth and economic development sound like very similar terms, they actually define two different concepts.

Economic growth refers to an increase in the monetary value of goods and services produced in an economy in a given period of time.

However, economic development refers to the process in which the overall health, well-being and standard of health of the general population improves. It is defined as a sustained improvement in the society’s material well-being.

Economic growth is a qualitative concept as it measures an increase in an economy’s output. It is measured by quantitative indicators such as GDP and GNP. However, economic development is a qualitative concept. Along with the growth in output, it also measures intangible changes such as improvements in the standard of living.

Economic growth is a relatively narrower concept. However, economic development is a relatively broader concept and includes economic growth.