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Discuss how the far economic growth is good for, people, government, firms and the environment.

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Introduction

Discuss how the far economic growth is good for, people, government, firms and the environment. An economic growth is an increase in the economy's real income in the short run and the long run. Short run means that increase in spending cases the Aggregate demand to shift to the right. In the long run, increase in the output can continue to be achieved if the productive capacities of the economy increase. There are many costs and benefits of economic growth. However there are more advantages in the economic growth than disadvantages, for this reason many governments prefer economic growth. ...read more.

Middle

This will case the living standard to fall. For this reason many economists measure real GDP per head. Another advantage to economic growth is that house holds will have more money to consume on the products and services. On the other hand it will encourage purchase of cars, demanding for more air travel and road expansions; all this will create more pollution, road conjunction and waste dumping due to increase in demand. The disadvantages of economic growth are that people may have to work longer and under pressure because of the increase in demand for products. ...read more.

Conclusion

Government should interfere and reduce goods and services that cases negative externalities and encourage goods and services with positive externality by subsidising them. Firms also benefits from economic growth as the demand increases the firms have to produce more goods and services to balance the increase in demand. Moreover, rapid increase in demand will over heat the economy, the effect is that the inflation will raise. Economic growth can effect environment as it suffers from heavy industrial growth as it produce pollution. It will also destroy natural land beauty and non renewable resources. Higher outputs will case more environmental problems and cleaning up the environment can be expensive. ?? ?? ?? ?? Vivek Santhirababu 1 | Page ...read more.

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