Economic Growth

AAA

DEFINITION of 'Economic Growth'

An increase in the capacity of an economy to produce goods and services, compared from one period of time to another. Economic growth can be measured in nominal terms, which include inflation, or in real terms, which are adjusted for inflation. For comparing one country's economic growth to another, GDP or GNP per capita should be used as these take into account population differences between countries.

INVESTOPEDIA EXPLAINS 'Economic Growth'

Economic growth is usually associated with technological changes. An example is the large growth in the U.S. economy during the introduction of the Internet and the technology that it brought to U.S. industry as a whole. The growth of an economy is thought of not only as an increase in productive capacity but also as an improvement in the quality of life to the people of that economy.

VIDEO

RELATED TERMS
  1. One-Third Rule

    A rule of thumb that estimates the change in labor productivity ...
  2. Gross Domestic Product - GDP

    The monetary value of all the finished goods and services produced ...
  3. Gross National Product - GNP

    An economic statistic that includes GDP, plus any income earned ...
  4. Recession

    A significant decline in activity across the economy, lasting ...
  5. Boom

    A period of time during which sales of a product or business ...
  6. Nominal GDP

    A gross domestic product (GDP) figure that has not been adjusted ...
Related Articles
  1. Economics Basics
    Economics

    Economics Basics

  2. Explaining The World Through Macroeconomic ...
    Options & Futures

    Explaining The World Through Macroeconomic ...

  3. The Importance Of Inflation And GDP
    Economics

    The Importance Of Inflation And GDP

  4. How Interest Rate Cuts Affect Consumers
    Credit & Loans

    How Interest Rate Cuts Affect Consumers

comments powered by Disqus
Hot Definitions
  1. Halloween Massacre

    Canada's decision to tax all income trusts domiciled in Canada. In October 2006, Canada's minister of finance, Jim Flaherty, ...
  2. Zombies

    Companies that continue to operate even though they are insolvent or near bankruptcy. Zombies often become casualties to ...
  3. Witching Hour

    The last hour of stock trading between 3pm (when the bond market closes) and 4pm EST. Witching hour is typically controlled ...
  4. October Effect

    The theory that stocks tend to decline during the month of October. The October effect is considered mainly to be a psychological ...
  5. Repurchase Agreement - Repo

    A form of short-term borrowing for dealers in government securities.
  6. Correlation

    In the world of finance, a statistical measure of how two securities move in relation to each other. Correlations are used ...
Trading Center