Notesale: Turn your study into money

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Assess the view that economic development is dependent on economic growth
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(25 marker)

Economic development is when a country seeks to improve the economic wellbeing and
quality of life by creating new jobs and supporting growing incomes
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The
HDI is a measure of development, using life expectancy, education and per capita income to
rank a country into a level of development
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This is because as AD shifts to the right and gets closer to full
employment, more people are employed and are earning wages
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Economic theory believes that as people consume more, they gain more utility as they
improve their living standards and gain greater prosperity
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However, an increase in economic growth can cause an increase in inequality
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(Draw the Lorenz curve to show the inequality)

Another reason that economic development is dependent on economic growth is that with
economic growth there is an increase in tax revenue
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In many developing countries such
as malaria in Sub-Saharan Africa there is an outbreak of disease, with an improvement in
health care, this can be tackled and ultimately improve the quality of life for these people
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Therefore, economic development is reliant on economic growth because the
government will raise the countries level on the HDI as education is a factor of
development
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This means that an increase in tax revenue
due to economic growth may not actually benefit the people of the country resulting in no
effect on economic development
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A reason that economic development is not dependent on economic growth is that aid can
be given to the country without growth, which can improve healthcare and education from
the foreign aid
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However, aid is also prone to corruption which would not benefit the country and there is a
development of dependency on aid which the country could begin to rely on

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