MYTUTOR SUBJECT ANSWERS

557 views

Are there any minuses to economic growth?

Growth is typically considered great - improvement in GDP per capita, incomes and living standards. However, if asked in the exam, there is something for you to mention.

Firstly, consider nature of growth. If it is caused by an increase in aggregate supply, there may be unneccessary spare capacity. For example, imagine a firm that buys 20 new machines but only uses five and does not need the rest? Same can happen in the economy. There is growth of economic potential and increase in unemployed resources. Alternatively, growth caused by an increase in aggregate demand can be inflationary (use a digram to demonstrate),

Secondly, is the growth always good? What if the growth is caused by an increase in gun production?

Thirdly, how equitable and inclusive is growth? If only the richest people and the government get the biggest share of the increase in incomes, growth is no good for general population.

Lastly, do we become happier when we get richer? Easterlin paradox (you don't have to remember the name) shows that people are only happy with the rise in income in the short term; in the long term, they are unsatisfied again, because the new amount is not enough again. Also, Bhutan, for instance, promotes an increase in happiness and not GDP per capita as their national policy. The government thinks that as people grow richer, they become less moral and forget spiritual values.

Julia L. A Level Maths tutor, A Level Economics tutor, A Level Russia...

1 year ago

Answered by Julia, an A Level Economics tutor with MyTutor


Still stuck? Get one-to-one help from a personally interviewed subject specialist

58 SUBJECT SPECIALISTS

£20 /hr

Mustafa A.

Degree: Economics (Bachelors) - Birmingham University

Subjects offered:Economics, Maths

Economics
Maths

“Highly proficient Maths and Economics tutor who's goal is to ensure that the student comes from a session with the ability to tackle the problem with ease.”

MyTutor guarantee

£20 /hr

Gabrielle F.

Degree: Philosophy, Politics and Economic (Bachelors) - Kings, London University

Subjects offered:Economics, Maths+ 2 more

Economics
Maths
English
.TSA. Oxford.

“Hi, I'm an enthusiastic tutor with experience in multiple subjects. I am currently studying a BSc in Philosophy, Politics and Economics at Kings College ”

£20 /hr

Gwyn P.

Degree: Economics (Bachelors) - Warwick University

Subjects offered:Economics, Maths+ 1 more

Economics
Maths
-Personal Statements-

“Undergraduate economist at Warwick University, one of the top programs in the UK. Extensive experience as a tutor in both maths and economics.”

About the author

£22 /hr

Julia L.

Degree: Economics L100 (Bachelors) - Durham University

Subjects offered:Economics, Sociology+ 2 more

Economics
Sociology
Russian
Maths

“Hi! My name is Julia, and I am Durham University student. I have just been through the stress of A level exams - I've been in your shoes, so now, my goal is to make your exam time as smooth and painless as it can be. I can help you wi...”

You may also like...

Posts by Julia

Are there any minuses to economic growth?

How do I approach an OCR fifty-mark essay?

How do I remember all that statistics?

Other A Level Economics questions

What is the difference between competitiveness and contestability?

Define the term ‘derived demand’

The government has introduced an ad valorem tax on petrol. The likely effect is: A) Increase in sales of petrol B) Increase in carbon emissions from electric cars C) Increase in demand for bus travel D) Decrease in sale of electric cars

What effect would a fall in the interest rate have on GDP?

View A Level Economics tutors

We use cookies to improve your site experience. By continuing to use this website, we'll assume that you're OK with this. Dismiss

mtw:mercury1:status:ok