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3 ECONOMIC GROWTH AND ECONOMIC DEVELOPMENT

This definition of economic growth consists of the following features of economic growth: z Economic Growth implies a process of increase in National Income and Per-Capita Income. The increase in Per-Capita income is the better measure of Economic Growth since it reflects increase in the improvement of living standards of masses.

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fared even better. Over the same period, their average real income increased by 236% (from $1,571,590, adjusted for inflation, to $5,279,695) and their share of national income almost tripled, from 3.4 to 9.5%.1 Over the same 33 years, median household income grew by only 9%. And this growth actually

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Income growth clearly strikes one as the main contributor to directly increasing the capabilities of individuals and consequently the human development of a nation since it encapsulates the economy’s command over resources (Sen, 2000).

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September 2014 - Brookings Institution

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