Economic growth can be defined as the rise in the output of an economy or a rise in national income over a given period of time. Economic growth can be beneficial to the economy but needs to be managed as so to not incur opportunity costs. This essay will discuss whether the benefits out weigh the costs of economic growth, or whether the costs exceed the benefits.
An advantage of economic growth is that it is likely to cause a rise in living standards due to an increase in wealth per capita of individuals in an economy. Economic growth will also create more jobs as companies will expand and new ones will be formed that will employ people, therefore unemployment may also fall. A rising demand and output will encourage investment in capital and therefore help to move towards a sustainable level of economic growth, opposed to a short-term growth. There may ...view middle of the document...
It may also cause a large rise in household and industrial waste. Growth that in the long run leads to a higher level of environmental damage is that it could reduce the long term stability of economic growth if natural resources are being used up in order to generate the economic growth, such as industries involved in de-forestation and over-exploitations of animal stocks. Many of the worlds finite resources are being extracted at such a rate that it is questioned by many economists the sustainability of the growth within economies. The usage of these finite resources are also contributing towards global warming due to the emissions that are given up to obtain the finite materials. Species may be becoming extinct due to a changing global climate and the effects of removing forests and over fishing.
Not all benefits of economic growth are shared equally; the profits of an economic growth may only majorly affect the people at the top end of the socio-economic scale, with the people in high-end jobs receiving a higher salary and the people lower down not seeing any large benefits. This could also lead to a wider gap between the people living in urban areas and rural areas, with the people living in the rural areas being worse off retrospectively than ever before.
Overall, I believe that growth of an economy is more of a benefit than a disadvantage due to the fact that more money will be flowing through the economy and there is the potential for more jobs to be created therefore reducing unemployment and increasing income per capita. Although there may be disadvantages such as the environmental impact that economic growth, but if extra income to the economy is managed correctly, the environmental impact may actually be able to be lowered by investing in new technologies that do not create as much harm to the environment.