Describe The Benefits Of Economic Growth
Economic growth means an increase in real GDP. This increase in real GDP means there is an increase in the value of national output / national expenditure.
The benefits of economic growth include:
Higher average incomes. This enables consumers to enjoy more goods and services and enjoy better standards of living.
Lower unemployment With higher output and positive economic growth firms tend to employ more workers creating more employment UK unemployment rises during a recession – falls during periods of economic growth.
Lower government borrowing. Economic growth creates higher tax revenues and there is less need to spend money on benefits such as unemployment benefit. Therefore economic growth helps to reduce government borrowing. Economic growth also plays a role in reducing debt to GDP ratios.
Improved public services. With increased tax revenues the government can spend more on public services, such as the NHS and education e.t.c.
Money can be spent on protecting the environment. With higher real GDP a society can devote more resources to promoting recycling and the use of renewable resources
Investment. Economic growth encourages investment and therefore encourages a virtuous cycle of economic growth.
Economic policies
Many government departments that form the pivot of an economic cluster, which was set
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