Economic Development: The Importance Of Growth And Sustainability

The importance of growth and sustainability for the economy comes from the fact that economic growth is fundamental to development and a stable economy, which enhances a nation’s development through the creation of revenue and employment. It is necessary to distinguish between economic growth and development (Hillbom, 2008). Generally economic development cannot be defined so precisely, as it is a multidimensional concept which refers to “changes in living standards and welfare over time”. It also referred to “structural change of economic and social infrastructure in an economy” as UNCTAD (2014) stated that economic development is fundamentally “a process of structural transformation whereby countries innovate and diversify from producing

It also leads to the creation of more opportunities in the sectors of education, healthcare, employment and the conservation of the environment. It implies an increase in the per capita income of every citizen. Alkire and Sarwar (2009) declared that there are several measures (multidimensional approach) which been used to estimate the development; (i) Increase in real Gross National Products (GNP), (ii) Increase in real per capita income, (iii) Rise in overall wellbeing of the people, (iv) Human Development Index (HDI) and Basic needs approach (also called Physical Quality of Life Approach (PQLA)). PQLA uses three indicators for measuring economic development, (i) Life expectancy, (ii) Infant mortality (iii) Literacy. The first HDI report was lunched by United Nation Development Program (UNDP) in 1990 and it is the most common index used to measure the economic development. It considers the GDP per capita (measured at PPP), health (measured in terms of life expectancy) and education (measured in terms of school enrolment ratio and literacy rate), which all of them affect the productivity and could lead to economic growth. Moreover, development is concerned with

Therefore, productivity is the cornerstone of economic growth and it occurs when various raw materials and other productive prerequisites, such as manpower and technology, are used to make some final product that is sold to and used by consumers. Competition promotes efficiency and productivity (Teo, 2003) and it directs resources to its most efficient use. In addition, a low degree of competition within a country is likely to lead to a high variation in efficiency and productive performance and consequently to sub-optimal productivity. Wilson (2008) stated that competitiveness measures are in-essence subset of measures of economic progress. He showed at Table ‎2.1 the example of two competitiveness measures (Global Competitiveness Index (GCI) and World Competitiveness Yearbook) that their determinants can measure the economic