Knowra Economic growth Economic growth Economic growth is an increase over time in an economy’s production of goods and services, commonly measured by changes in real gross domestic product (GDP).
Labor productivity : Output produced per unit of labor, such as per worker or per hour worked. Rising output per hour is a central source of sustained growth.
Gross domestic product : The monetary value of final goods and services produced within a country during a specified period. GDP is the most common measure of the size of an economy’s output.
Adam Smith : An eighteenth-century Scottish economist and philosopher known for analyzing markets, specialization, and national wealth. His account of division of labor linked specialization and expanding markets to rising productive capacity.
Recession : A significant decline in economic activity across an economy, typically lasting more than a few months. A recession is a contraction in activity rather than a sustained increase in output.
Standard of living : The material conditions and resources available to a person or population. Growth may increase average consumption possibilities, though its distribution matters.
Total factor productivity : The portion of output growth not explained by measured growth in labor and capital inputs. It captures efficiency gains and technological change beyond adding workers or equipment.
Real GDP : Gross domestic product adjusted for price changes to measure the volume of production over time. Real GDP separates changes in output from inflation.
David Ricardo : A British political economist whose theories addressed distribution, trade, and the limits of economic expansion. His analysis of land, rents, and diminishing returns framed a classic debate about growth limits.
Business cycle : Fluctuations in economic activity around its longer-term trend, including expansions and contractions. Short-run booms and downturns can obscure the underlying path of growth.
Poverty reduction : A decline in the share or number of people living below a defined poverty threshold. Rising incomes can reduce poverty, depending on who gains from growth.
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