Economic growth is the increase in the inflation-adjusted market value of the goods and services produced by an economy over linear stages of growth model pdf. It is conventionally measured as the percent rate of increase in real gross domestic product, or real GDP. Rate of change of Gross domestic product, world and Organisation for Economic Co-operation and Development, since 1961.
Growth is usually calculated in real terms – i. Measurement of economic growth uses national income accounting.
The economic growth rates of nations is commonly compared using the ratio of the GDP to population or per-capita income. The “rate of economic growth” refers to the geometric annual rate of growth in GDP between the first and the last year over a period of time.
Implicitly, this growth rate is the trend in the average level of GDP over the period, which implicitly ignores the fluctuations in the GDP around this trend. GDP and people for the initial and final periods included in the analysis. In a famous estimate, MIT Professor Robert Solow concluded that technological progress has accounted for 80 percent of the long-term rise in U.