DETERMINANTS OF ECONOMIC DEVELOPMENT DEFINITION Economic development is

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DETERMINANTS OF ECONOMIC DEVELOPMENT

DETERMINANTS OF ECONOMIC DEVELOPMENT

DEFINITION Economic development is defined as improvement in material well- being which we may

DEFINITION Economic development is defined as improvement in material well- being which we may consider to be reflected in an increasing flow of goods and services”. According to Dr. R. D. Gill, “ Determinants of Economic development are based upon the size of production capacity, organisation and character of an economy”.

DETERMINANTS OF ECONOMIC DEVELOPMENT Economic Determinants Non-Economic Determinants

DETERMINANTS OF ECONOMIC DEVELOPMENT Economic Determinants Non-Economic Determinants

ECONOMIC DETERMINANTS Labour or human resources: If human resources are properly used, it will

ECONOMIC DETERMINANTS Labour or human resources: If human resources are properly used, it will accelerate the process of development. If not, these may hamper the very process of development. Human resources are broadly categorised as (1) physical labor (2) human skill. Size of the Market: Large size of the market would stimulate production, increase employment and raise the National per capita income.

 Capital Formation: The principle aim of Economic development is to utilize part of

Capital Formation: The principle aim of Economic development is to utilize part of the world resources on the production of Capital goods, so that greater production of consumer goods is possible in the Future. Capital formation impacts the process of development in two ways: (1) capital Deepening (2) capital Widening Natural resources: Natural resources determine the limit of Economic development of a Nation. All natural resources can be categorised into three categories: (1) Bio-climatic resources (2) Fossil- fuel (3) Non- fuel mineral resources.

 Structural change: It refers to change in the occupational structure of the economy.

Structural change: It refers to change in the occupational structure of the economy. Economy of the country is generally divided into three basic sectors: Primary (such as agricultural, animal husbandry, forestry etc. ) , Secondary (such as Industrial production, constructions and the like) and Tertiary (such as trade, banking and commerce). Financial stability: It implies the existence of an efficient and organised banking system in the country. There should be an organised money market to facilitate easy availability of capital.

NON-ECONOMIC DETERMINANTS They are non-quantifiable In general they are not amenable to traditional tools

NON-ECONOMIC DETERMINANTS They are non-quantifiable In general they are not amenable to traditional tools of Economic analysis They are either not factored in Economic theories and models or assumed as given for e. g. Political environment Social determinants Religious outlook Cultural and Institutional aspects. Freedom from corruption etc.

CONCLUSION Economic Development is not determined by any single factor, determinants of development includes

CONCLUSION Economic Development is not determined by any single factor, determinants of development includes wide range of parameters from “ what nature gives” to “ what man accomplishes”. However, given the nature endowments, it is the conscientious effort of the people that determines the pace of growth and development. By proper coordination of BOTH these factors Economic and Non. Economic and aspiration of the people and the government, for development that the rate of Economic growth can be accelerated.