Economic growth refers to increases in the total output of goods and services produced by an economy. This is usually measured by the Gross Domestic Product (GDP).
A nation can grow extensively by accumulating more physical or natural resources, intensively by using existing ones more effectively and productively, or a combination of both. The latter is the most common form of growth in modern economies.
There are many benefits of economic growth, but the most important is that it allows people to improve their living standards. For example, a person can buy more food and take longer trips with the money they earn through growth. It also allows them to afford better healthcare, invest in education, and live in a safer environment.
In addition, a growing economy allows individuals to save more of their income, which can encourage investment and further growth. A growing economy can also reduce unemployment rates and poverty, which makes it more equitable for everyone.
Lastly, higher incomes allow people to spend more on charitable causes and other things that benefit society. This is an essential part of any economic system, and it helps create a positive cycle where more good things are created.
Economic growth is a complex topic, and there are many different theories of how it works. For example, some believe that growth is driven by technology, while others think it’s caused by a combination of factors such as resource allocation, improvements in labor management, and better economic efficiency.