lesson 12- economic growth Flashcards
what is economic growth
growth in a countrys economic output over time
-measured as GDP, and is the value of all goods and services produced in an economy
what is a recession
+example
two consecutive quarters of negative economic growth
UK economy grew by -0.3% in 2023
what is real GDP
accounts for inflation, whereas normal GDP doesn’t
what is GDP per capita
per person
Gross National Product
output by firms owned by a country
may be producing abroad
why is unemployment not usually used to measure economic growth
lag time between change in economic cycle and change in job market
what are the limitations of GDP statistics
-lots of sources
-inaccuracy of calculations
-human error
-predictions
-figures get revised and changed later on
what is gross value added (GVA)
GDP minus indirect taxes
what is gross national income (GNI)
GDP minus net depreciation
what are the benefits of economic growth
-higher living standards
-better health and life expectancy due to gov spending and ability to buy healthy food
-education development
-job creation as firm demand increases
-increased tax revenue for government, can spend or invest
-accelerator effect- higher increase in investment than growth
what are the problems of economic growth
-inflation
-strain on services and firms
-environmental issues
-scarcity
-inequality
what is sustainable growth
growth in the productive potential today which doesn’t lead to a fall in the productive potential for future generations
what is the easterlin paradox
happiness doesnt increase much when high levels of income increases, but do when low levels of income increases
how does economic growth relate to pollution
HIC -> less
LIC-> more
what is a anti growth lobby
people who are well off generally, and a consumption cut will not effect them much at all
