Economic Growth and Economic Development (VSAQs)
Economics-2 | 1. Economic Growth & Economic Development – VSAQs:
Welcome to VSAQs in Chapter 1: Economic Growth & Economic Development. This page includes the most crucial FAQs for Very Short Answer Questions. Each answer is given in simple English and follows the exam format. This will help you focus on the key concepts and aim for top marks in your final exams.
VSAQ-1: Economic Growth
Economic Growth is like the engine that drives a country’s progress. It measures how much a nation’s ability to produce goods and services has expanded over time. Think of it as a nation getting better at making things, from food to technology, and offering more services, like education and healthcare. This growth is usually tracked by looking at the Gross Domestic Product (GDP), which is the total value of everything a country produces in a year.
When a country experiences economic growth, it means there’s more wealth, better jobs, and a higher standard of living for its people. It’s a sign that the country is moving forward, becoming stronger, and working towards prosperity.
VSAQ-2: Physical Quality of Life Index (PQLI)
The Physical Quality of Life Index (PQLI) is like a report card for a country’s well-being. Developed by M.D. Morris in 1971, this index goes beyond just looking at how much money a country makes. Instead, it considers important aspects of life like life expectancy, literacy rates, and the infant mortality rate to measure how well people are living.
For example, if a country’s PQLI score improves, it means people are living longer, more children are surviving, and more adults can read and write. This makes PQLI a valuable tool for understanding a country’s development in terms of health, education, and overall quality of life, rather than just its income levels.
VSAQ-3: Economic Development
Economic Development is like the bigger picture that includes not just growing wealth, but also improving the quality of life for everyone in a country. While economic growth focuses on increasing the nation’s income (GDP), economic development looks at how that growth is used to improve living standards, reduce poverty, and bring about social changes that benefit all citizens.
For instance, when a country invests in better schools, healthcare, and infrastructure, it’s working towards economic development. This concept is about making sure that as a country gets richer, the benefits of that wealth are shared widely, leading to better lives for everyone.
VSAQ-4: Self-Reliance (Economic Self-Reliance)
Self-Reliance in economics is like a country being able to stand on its own two feet. It means the country can produce enough resources, like food, energy, and goods, to meet its own needs without having to depend too much on other countries.
For example, a country like India, which is working towards becoming less dependent on imported goods by boosting its own industries, is striving for economic self-reliance. This independence allows a country to have more control over its economy and reduces the risks associated with relying on foreign aid or external resources.
VSAQ-5: Sustainable Development
Sustainable Development is like planning for a better future while taking care of today’s needs. It’s about growing the economy in a way that doesn’t harm the environment or deplete the resources that future generations will need. This concept was defined by the Brundtland Report and focuses on balancing economic growth with environmental protection.
For example, if a country invests in renewable energy, such as solar or wind power, it’s promoting sustainable development. This approach helps the country grow economically while also ensuring that natural resources are preserved for the future, making it possible for both current and future generations to thrive.
VSAQ-6: Inclusive Growth
Inclusive Growth is like making sure everyone gets a slice of the cake when the economy grows. It’s not just about the economy getting bigger, but also about making sure that the benefits of growth reach everyone, especially those who have been left out in the past. The World Bank defines it as economic growth that is shared fairly among all sections of society, including marginalized groups.
Imagine a village where the economy starts booming. Inclusive growth would mean that not just the wealthiest families benefit, but also the farmers, laborers, and even those who have been struggling to make ends meet. It’s about ensuring that everyone has a chance to improve their lives as the economy grows, leading to comprehensive development and better social well-being.
VSAQ-7: Social Progress Index (SPI)
The Social Progress Index (SPI) is like a report card for a country, but instead of focusing on money, it looks at how well the country is doing in taking care of its people. The SPI measures things like access to basic human needs (like food and shelter), opportunities for a better life (like education and personal freedom), and the overall well-being of the population.
For example, if a country has a high SPI, it means people have good healthcare, clean water, education, and freedom to make choices about their lives. The SPI helps us understand how well a country is doing in terms of social and environmental progress, not just economic growth. It’s a tool that shows whether a country is providing a good quality of life for its citizens.
VSAQ-8: National Resources
National Resources are the assets a country has, which include everything from its natural resources, like forests and minerals, to its human resources—the people who live there. Human resources are particularly important because they represent the skills, knowledge, and productivity of a country’s population.
Imagine a country where the government invests heavily in education. This increases the skills and abilities of the people, making them more productive and innovative. As a result, the country’s economy can grow faster, leading to better job opportunities and higher standards of living. Education is key in developing human resources, which are essential for a nation’s prosperity and economic progress.
VSAQ-9: Vicious Circles of Poverty
The Vicious Circle of Poverty is like a trap that keeps people and countries stuck in poverty. When a country lacks enough capital and remains economically underdeveloped, productivity stays low. This leads to low incomes, which in turn reduces demand for goods and services, further slowing down economic growth.
Imagine a small town where most people are poor. Because they don’t have much money, they can’t buy many goods, so businesses don’t grow. Without growth, there are no new jobs, and without jobs, people remain poor. Breaking out of this vicious circle requires strategic policies and investments, like improving education, infrastructure, and healthcare, to boost economic growth and lift people out of poverty.
VSAQ-10: Marketable Surplus of Agriculture
Marketable Surplus of Agriculture refers to the extra produce that farmers grow beyond what they need for their own use. This surplus can be sold in markets, bringing in more income for farmers and helping them improve their livelihoods.
For example, if a farmer grows more rice than their family needs, they can sell the extra rice in the market. The income from this surplus can be used to buy other goods, invest in better farming equipment, or improve their home. The marketable surplus not only benefits the farmers but also helps grow the economy by increasing demand for consumer products and agricultural inputs. This, in turn, can boost the industrial sector and contribute to overall economic development.
VSAQ-11: Gender-Related Development Index (GDI)
The Gender-Related Development Index (GDI) is like a special lens that helps us see how well men and women are doing in comparison to each other in a country. Introduced in the 1995 Human Development Report, the GDI is similar to the Human Development Index (HDI), but it specifically focuses on gender inequalities in three key areas: health, education, and income.
For instance, if a country has a large gap between its HDI and GDI, it means there is significant gender inequality—women might have lower access to education or healthcare compared to men. The GDI is important because it highlights where gender gaps exist, helping countries focus on improving equality and ensuring that both men and women can achieve their full potential.