Relationship between Economic Growth and Economic Development

As it is proved by name of this article that economic growth and Economic Development are two different terms/subjects/processes.

To understand the relationship between both first we have to understand what is Economic Growth and what is Economic Development then in second part, we will try to differentiate the both and at last in conclusion, we will relate both terms.

Economic Growth (EG)

The chronic process of value addition in goods and services is known as economic growth or the process of continuous growth in real Gross Domestic Product (GDP) or in real Per Capita Income (PCI) is known as economic growth.

Economic Development (ED)

The situation where manufacturing of goods and services increases parallel with social welfare is known as economic development or progressive changes in the economic and social machinery of any country’s economy is known as social development. (Here I used the word COUNTRY’s Economy because generally EG and ED discussed in the context of a country but it can be discussed in context of any small area. For example M.P., U.P., Bihar etc)

Now differentiate EG and ED

Economic GrowthEconomic Development 
  • It is known as the real progress in manufacturing
  • It is the progress in economic growth along with social welfare
  • It is a quantitative concept
  • It is qualitative concept
  • it is a unidimensional concept
  • It is a multidimensional concept
  • It can be measured
  • It cannot be measured.
  • It is only our medium to achieve ED
  • It is an aim in itself
  • It can be achieved without economic development
  • It cannot be achieved without economic growth
  • Developed countries give more priority to economic growth 
  • Developing countries like India give more priority to economic development
  • Index- real GDP, real Per Capita Income
  • Index- Human Development Index (HDI), Physical Quality of Life Index (PQLI), real Capita Income

Trend (2013-2016)


Economic growth is a subjective term which can be measured and one can compare it with economic growth of other country or region because it depends on manufacturing of goods and services but on the other hand Economic development is a broad term which can not be measured and differs from region to region for example in USA if one does not own a car he/she is not economically developed but in India if one can not earn food and apparels he/she is not economically developed.

Where economic growth can be achieved in a short time period of 4 to 5 years (if conditions are suitable) but economic development can not be achieved in short time (as in India government it already took more then 6 decades).

Economic growth is when some or all people have sufficient money to spend but economic development is when approx every citizen is happy.


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