Please enable JavaScript.
Coggle requires JavaScript to display documents.
Economic growth - Coggle Diagram
Economic growth
Benefits
Higher Average Incomes
Enables consumers to enjoy more goods and services
better standards of living
Money spent on environment
Higher Real GDP society can give more resources to recycling and renewable resources
Lower Unemployment
firms tend to employ more workers
higher output and positive econ growth
Investment
encourages investment and therfore encourages a virtuous cycle of econ growth
Lower Government borrowing
Creates higher tax revenues
less money spent on benefits
Improved public services
Lower government Debt
costs
Inflation
If AD increases faster than AS economic growth is unsustainable
Demand increases too quickly firms will push up prices
Current account Deficit
causes increase in spending on imports therefore causing a deficit on the current account
Boom and Bust Economic Cycles
If economic growth is unsustainable then high inflationary growth and followed by a recession
Environmental Costs
Increased output therefore increased pollution
cause health problems like asthma
speed up depletion of non-renewable resources
Inequality
growth help richer people more than the poor
Measured by GDP
Nominal GDP
Real GDP
Nominal GDP-Inflation
NE+NI+NO