Economic Growth and Development Essay

Published: 2021-07-06 06:37:55
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Category: Economics

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Economic growth has been dominant all over the world in the past five decades; this has led to economic growth in many nations. The world economy is about five times the value it was half a century ago (Jackson, 2009).However, Richard Easterlin argued that it didn’t raise happiness. According to his work, the US between the year 1946 and 1974 happiness level was at the same level in that period despite the level of income doubling at that duration (Easterlin 1974).Moreover, Easterlin afterward proof that the condition remained the same in the US and this was also shown in other countries (Easterlin 1995, 2004). However, Hagerty and Veenhon (2003) challenge this view as their research outline data about happiness rate in twenty-one countries along 1972-1994. It indicates that happiness had improved in these countries; hence get a positive relation with strengthening the economy. The differences occur in that not all available data are well clear and outdated hence encouraging much personal interpretation also changes in happiness is just a small bit. However, referring to Ryan (2001), growth in economy determines sustainable development, which results in improved human well-being. This essay argues that economic growth has a catalytic effect on human well-being, and it is an essential but insufficient condition for human well-being. Here are three parts of human prosperity considered: Objective well-being (OWB) for example, material riches and physical wellbeing, Subjective well-being -being (SWB) for example, joy and social quality, Comprehensive prosperity (CWB) for example, training, and environment (Rogers et al., 2012). This paper will argue on the basis that economic growth has catalytic effects on the well-being of humans being in that; it improves facilities and education platforms that are termed as primary sources of human well-being. It reduces differences in status and more importantly the life expectancy of people therefore triggering happiness. Regardless of it being essential, it is an insufficient condition for human well-being in that people tend income desire and aspirations impose negative effect on human well-being. Also, government fail to channel income in public facilities and welfare, regardless of the economic development the income does not advance peoples’ well-being. It is insufficient since it is inadequate for meeting rapid advancements for human development. Nevertheless, these are likely to be resolved by proper devotion of accrued income towards public facilities, control human desires and aspirations, and investing heavily on the education sector, which proves result in nation happiness. Other resolutions are investing on systems that govern performance of the government and more importantly effectively guarantee the basic needs to the poor. Improving the security of human being is a good area to capitalize on to resolve negativity in human well-being.The consequence of economic progress concerning the GDP of a nation result to a positive correlation with the well-being of people. Clark and Senik (2014) stipulated that people with a good material life condition (OWB), in most cases have a higher income. In the meantime, they can access better learning facilities and decorate corporate environment, which leads to their life satisfaction usually is innovative than others. However, according to Charness and Grosskopf (2001), they argued that individual well-being is negatively influenced by desire for income and income aspirations. This is because SWB might be affected by relative benefits like income gap among others (Stuzer, 2004; Charness and Grosskopf, 2001). For instance, in China, due to financial development, income level for people has increased rapidly making it four times relative to the past. Yet, this hasn’t improved most Chinese people’s life satisfaction since it is still low from expectation (Clark and Senik, 2014). Nonetheless, this is clearly a paradox: SWB depends on desire and reality match, own wish and others experience. That means if the relativity remains constant, the absolute log is meaningless (Clunies‐Ross, 2002). For example, when demand and desire to buy goods is widely met, the extra income may be largely seen as a prize in a competition. According to this fallacy, people may never be satisfied. Although, Veenhoven and Hagerty (2006) in their research evidently concluded that even if in the case of an already urbanized nation like Japan and some countries in Europe, the development of economic growth of human happiness has no significant influence. This was not the case in low-income countries, where income increase stirs happiness (Veenhoven and Hagerty, 2006). Barro and Sala-i-Martin (1992) also indicated that improve income reduces infant mortality, an issue concerning educational outcomes, for instance, the rate in school dropout, performance and the rate children repeat a year schooling considerably positively or negatively influenced by per capita income. Therefore, in general, the economic growth could raise people’s income level to close to their current expectations of life needs. Moreover, to a certain extent, it can reduce the relative difference and improve the quality of life, which lead to SWB and OWB. However, Venables (2006) argued that even if economic growth has a significant positive effect, it is not good enough for making more rapid advance in the development of human. Therefore, income increase is encouraging for a nation, but fails to meet condition for peoples’ well-being enhancements.Economic development and well-being have do relate casually in that government make profits projected towards infrastructure and other social amenities. According to Anand and Ravallion (1993), they argued that the major responsibility of social services is ensuring availability of education and healthcare because they determine human well-being. Furthermore, Jorgenson (2006) indicated that the startups of learning facilities and the health centers tend to depend on the amount of income generated by the nation. Empirically, basic needs of individuals in society can either be physical health and also can be mental health and finally life expectancy, and these basic needs are associated with SWB (Costanza et al., 2007, 2009;Clark, 2014).This is practicable with maximizing the profits generated by the government like building more schools, hospitals and providing favorable urban living environment. For example, research conducted in China recently concluded that there is affirmative feedback between the strength of the economy and landscape urbanization (Mitchell D, 2008). However, several evidences show that human well-being is closely linked to government political performance and welfare policy. For instance, India has low happiness levels due to the low level of services infrastructure. Yet, a state called Kerala, in South India, has its human welfare higher than that of other parts of India (Bellinger, 2018).This is because the Kerala government provides a wide range of public services and strengthening cooperation among political parties to improve the efficiency of executive force (Bellinger, 2018). Similarly, O ‘donnell and Oswald (2015) found that the GDP of Wales was lower than that of England, while people’s happiness was higher because of the better welfare measures. This seems to conclude that people’s happiness levels differ depending on the political performance of governments not merely the economic level. Some governments may not fully devote all their gains to public facilities and welfare measures. Whereas, regardless of these factors, nations that passed the development stage long time usually have quality health facilities, education grounds, and more importantly, the education offered is above average, which result in the higher national happiness (Frey and Stutzer, 2010). Besides, the effect is evidenced in the third-world countries, the health and Longevity of citizens reported having an increase in quality as the economy increase (Bloom, Canning, and Sevilla, 2004). Economic growth also creates special opportunities, challenges, and improving public sector (Lamb and Steinberger, 2017). In a nutshell, positive development of economy has the effect of boosting the standard of learning, healthcare facilities and public services hence influencing human well-being in a positive manner. However, democratic voting system, good supervision system should be made to supervise government behavior.The development of economy globally can benefit the raising of community poverty level and keep the social stability. Security is an integral part of human well-being (Rogers et al., 2012). However, in most poor areas, such as Tanzania, where people live in turbulent social environments without the basic security, human rights and well-being are not guaranteed (Camfield, 2012). Economic development has taken a significant role in helping individuals out of extreme poverty, for example, a reorganized result from the World Bank approximated, level of scarcity ( people living below $ 1.25 a day) has significantly go done to an estimation of about twenty-five percent in the year 1981 to 2005(Chen and Ravallion, 2008). In spite of the positive influence concerning the development of the economy, there exists evidence to critic the notion that development of the economy is a sufficient condition for human being well-being. The gap between the poor and the rich is broadening regardless of the poor improving their lifestyle. In a research about a current study of financial allocation and scarcity by published OECD (2008), this hole separating the haves and the have-not has increased to about three-quarters of the financially stable state since the middle of the 1980s. This explains the reason behind why poor individuals continue to have un-appealing life while the rich progress in widening the gap. The effect is against the slippery slope fallacy that demands that when one situation occurs, then it should affect another in equal magnitude. In our case, the increment in the economy affects the rich positively; it would be normal to think that the same will happen to the poor. However, we are presented with the poor being servants of the rich where payment of services delivered by the rich makes the poor remain oppressed. From later research, by Clark and Senik-Leygonie (2015), which was based on the financial allocation and the effect of scarcity, the study proved that the development of economy does not strive to raise the level of poor people as it benefits the rich, making the have-not remain lowly lives. It is possible to conclude that economic development is inefficient to influence people’s well-being.It is importantly declining the gap between the poor and the rich. Nevertheless, the benefits of economic growth like price reduction and increase in high employment rate can improve the quality of life (Veenhoven, 2005d). Alternatively, economic development created the opportunity for the poor to live by their own labour and reduced the cost of living. To a certain extent, it can effectively guarantee the basic needs and raise the general income level of the poor to narrow the gap. Moreover, economic growth has social advantage. However, the exaggerating should be avoided when dealing with social functions. It should not be assumed there is a rigid association between economic strength and the social goals achievement. Other than economic growth dependency, our focus can be fixed towards the likelihood of providing common objective by altering construction hence also leadership. This is because the social status, authority and manipulate on social matters are perhaps increasing up from poor to the rich (Bellinger, 2018).The economy has an unconstructive impact on the surroundings due to resource overuse, climatic changes and environmental pollution (Northrop, 2014;Dasgupta, 2007).Most developing countries use environmental destruction to accelerate economic development (Garcia- Sanchez et al., 2015;Xue 2010;Almeida et al. 2017).Ecological environmental is a very significant state to evaluate overall well-being (Rogers et al., 2012). Also, Van Kamp et al., (2003) stipulated there is a notable improvement of the material condition of people and that the concentration and the needs of the environment have been strengthening significantly. For instance, the economy of United States is beyond other nations because of lack of enough resource allocation and the environmental environment, subjective wellbeing index and objective well-being remains low as compared to that of US (Easterlin, 1974).However,the effect of development economics is time-dynamic. Economic growth has short and long-term effects. Sustainable policies demand a good foundation and strengthen economic development. Essentially, the current requirement for sustainability is to key the track and maintain peoples well-being and the pressure existing in the environment “energy intensity of human well-being” (Jorgenson and Dietz, 2014; Alekseyko and Giedraitis, 2014). According to Giedraitis, Jorgenson, and Alekseyko (2014), the study showed that due to a growth of a countries economy, raise of energy utilization has an influence on the intensity of energy in many nations all over the world. Furthermore, during the final phases of growth of an economy, people’s well-being and the natural environment were more harmonies due to the correlation between EIWB and increase of income. In other words, although the ecological condition is destroyed as the nation strives to attain resources in short term (Rogers et al., 2012), the long effects of economic development include the introduction of new form of energy and efficient resource utilization to promote the harmonious development of economy and environment. With timed increase, the economic growth has significantly led to the fall in EIWB in both advanced high-income nations and less developed countries. This decline has been there in the past decade (Jorgenson and Dietz, 2014).Therefore, economic growth may have convincing advantages on human well-being (Wackernagel and Rees, 1996), because it lays the economic foundation for sustainable development. However, for the community to have enough potential for growth to satisfy all members of the economy, the capability of the future generation must be considered (Ryan, 2012).The impact of development in the economy on the enhancement of human well-being can be evidence as discussed in the piece. With the explanation of both the positive and negative outcomes that are associated with economic development, the essay was able to denote the influence of economic development. Some of the evidences proven in the essay include the fact that economic growth can improve public services, education platforms, and more importantly improving the life expectancy. There are also notable negative effects because of economic growth (environmental degradation, pollution) but the positive impact supersedes the negativity. There exists uncountable evidence concerning the prosperous effects that improvements in the economy can result. Furthermore, economic growth is beneficial to the current and future generation. The research however relied on collected data and that might be biased. Therefore, cannot be depended as ultimate determinant of a country’s progress. Much needs to be researched concerning the influence of economic growth. The impact on the modern developing world need to get extensive research since there are drastic changes from the time of the research. Therefore, countries must work to invest in boosting the economy but taking care of the ecological environments since the environment is an important factor in enhancing the well-being of people. The impact of economic development remains insufficient to influence the well-being of human being. The development of a country economically proves to have the ability to influence the well-being of human being. However, the effect is not sufficient to serve all the needs of human being. 

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