Economic growth increases the amount of goods and services produced per person. It’s generally measured by the gross domestic product (GDP), which adds up consumer spending, business investment, government spending, and net exports.
The main driver of economic growth is technological progress, which often increases the productivity of labor and capital. Economies of scale and improved resource allocation can also help boost economic output, as is the case when companies invest in new technologies or when products are sold to many customers at once.
Other benefits of economic growth include poverty reduction, better living conditions, and reduced inequality. For example, consistent economic growth can increase life expectancy and other health-related measures in low-income regions despite diminishing returns in high-income regions.
Some people worry about the environmental costs of economic growth, particularly since it often relies on polluting fossil fuels to enable it. However, many economists argue that economic growth is a good thing overall, and that more is better if it’s done well.
A growing economy is also good for people, because it means more jobs and opportunities to advance in their careers. It can also make the world more prosperous, making it safer and more stable. However, it’s important to remember that a growth economy also contributes to pollution, global warming, ozone depletion, and other environmental problems. If we want to address these problems, it may require a fundamental change in the way that we use energy and other natural resources.