Economic Growth Flashcards
What is economic growth?
Economic growth is when the amount of goods and services produced in the economy increases from one year to the next.
Outline and explain five positive effects of economic growth on society.
Employment-A greater demand for goods and services will lead to increased employment
Improved Standard of Living-People will have more money to spend
Increase Government Revenue-This is due to increased employment meaning more Income Tax collected
Decreased Government Expenditure-This is due to increased employment meaning less people needing social welfare
Improved Infrastructure-Countries with high economic growth spend more money improving telecommunications, transport.
Outline and explain four negative effects of economic growth on society.
Inequalities-Even with economic growth, many of the gains from growth may be only for a few people and vulnerable people stay vulnerable
Inflation-Increased demand for goods and services can cause inflation (rise in prices)
Increased Life Span-An increase in standard of living leads to longer life expectancy. The ageing population means more spending on healthcare
Obesity-An increase in standard of living could lead to income being spent on too much goods and services which can lead to obesity.
Outline and explain two positive effects of economic growth on the environment.
Investment in Environmentally Friendly Technologies-If companies are making more money they may choose to invest in environmentally friendly business practices to be more attractive to consumers e.g. low carbon
Time & Funding-When economies are doing well governments have time and funding to address environmental concerns e.g. climate change
Outline and explain four negative effects of economic growth on the environment.
Non Renewable Resources-Increased demand for goods (import/export) requires planes and ships that burn fossil fuels. These are in limited supply.
Traffic Congestion-The increase in demand for goods requires delivery which causes traffic congestion and pollution e.g. carbon emissions.
Increased waste-Increase consumption of goods and services results in more waste which will require landfill.
Destruction of nature-Greenspace and natural habitats are eroded from the building of new factories