Question

How would you distinguish between development and non-development expenditure?

Answer 1

Development expenditure is related to investment expenditure or productive expenditure which enhances production capacity in the economy.

Example: Expenditure by the government on roads and bridges, non-development expenditure is related to consumption expenditure by the government (also called unproductive expenditure) .

Example: Expenditure by the government on law & order and defence of the country.