ECN204 Lecture 3: Economic Growth

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Published on 14 Feb 2016
School
Ryerson University
Department
Economics
Course
ECN 204
Professor
ECN204Lecture3EconomicGrowth
EconomicGrowth
Economistsdefineandmeasureeconomicgrowthaseither
AnincreaseinrealGDPoccurringoversometimeperiod
AnincreaseinrealGDPpercapitaoccurringoversometimeperiod
RealGDPpercapita=RealGDP/population
RealGDPgrowth
Growthasagoal
Growthisawidelyheldeconomicgoal
Growthrisesstandardsofliving
Growthlessenstheburdenofscarcity
Arithmeticofgrowth
Ruleof70
ApproximatenumberofyearsrequiredtodoublerealGDP=
70/annualpercentagerateofgrowth
ModernEconomicGrowth
Thehistoricallyrecentphenomenoninwhichnationhaveexperiencedsustainedincreasesin
realGDPpercapita
Dramaticincreasesinthestandardofliving
StartedwiththeIndustrialRevolutionoflate1700s
Priorto1700s,GDPpercapitawasflatoverlongperiodsoftime
Economicgrowthhasvastlyaffectedcultural,socialandpoliticalarrangements
Culturally
Forthefirsttimeinhistoryordinarypeoplehavesignificanttimeforleisure
activitiesandthearts
Socially
Hasallowedforuniversalpubliceducation,eliminationofancientsocialnorms
andlegalrestrictionsagainstwomenandminoritiesdoingcertainjobsor
holdingcertainpositions
Politically
Countriesexperiencemoderneconomicgrowthhavetendedtomovetoward
democracy
Theunevendistributionofgrowth
ModerneconomicgrowthhasspreadslowlyfromitsBritishbirthplace
FirstadvancedtoFrance,Germany,andotherpartsofWesternEuropeintheearly
1800sbeforespreadingtoCanada,theUnitedStates,andAustraliabythelate1800s
Japanbegantoindustrializeinthe1870s
TherestofAsiadidnotfollowuntiltheearlytomid1900s,atwhichtimelargepartsof
CentralandSouthAmericaaswellastheMiddleEastalsobegantoexperience
economicgrowth
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