MEANING AND CONCEPTS OF ECONOMIC DEVELOPMENT
The meaning of economic development is quite complex. However, economic development is defined as a long period dynamic process which enables a poor country to break or challenge its vicious cycle of povert and thereby helps it to attain higher levels of income, ouput, employment and thereby assure better standard of living. This economic development contributes toward's enhancement of material gains and
other comforts of lite and also helps a country towards attaining equitable distribution of income and wealth.
Thus, the concept of development based on poverty, equality ad employment criteria is quite superior to traditional view of development based on income. Accordingly, Michael P. Todaro observed.
"Development must, therefore, be conceived as a multi-dimensional process involving major changes in social structures, popular attitudes and national institutions, as well as the acceleration of economic growth,
the reduction of inequality, and the eradication of absolute poverty. Development, in its essence, must
represent the entire gamut of change by which an entire social system, tuned to the diverse basic needs and
desires of individuals and social groups within that system, moves away from a condition of life widely perceived as unsatisfactory and towards a situation or condition of life regarded as materially and spiritually better."
Thus economic development indicates progressive changes in the socio-economic structure of a country, In modern times, the term economic development is considered to mean growth along with
progressive change in certain crucial variables determining the well being of the people. Thus the problem
development must be analysed as a selective attack on the poverty. Moreover, it must be analysed in terms of progressive reduction and elimination of malnutrition, disease, illiteracy, unemployment and
ues, There are two main approaches of economic development. These include : (i) the traditional approach and (ii) the new welfare-oriented approach.
While the traditional approach defines economic development strictly in economic terms, i.e., in terms of annual increase in GNP but the new welfare-oriented approach redefines the concept of economic development in terms of reduction or elimination of poverty. unemployment and inequality in the contribution of growing economy
Thus, from the above analysis it can be said economic development simply indicates achievement higher levels of real per capita income and improved conditions of living for its common masses
Prof Alter Krause mentioned three basic indicators to identity whether economic development is taking place in a country or not. These indicators are as follows :
(i) In order to attain economic development, income of the country must rise cumulatively for some considerable period. Thus is order to justify attainment of economic development income of the country must rise year after year.
(i) Economic development in a country will take place when the population in general are largely benefitted from such an increase in income.
(ii) Attainment of economic development will take place with the cumulative increase in real per capita income which is likely to be attained when aggregate income of the country will rise at a faster rate than that of population
However, economists like Simon Kuznets, Meier and Baldwin, Kindleberger ete, mentioned some alternative indicators, of economic development. These are:
(i) Growth of national income.
(ii) Increase in real per capita income for along period of time.
(iii) Comparative attainment of economic development both within the country at different time periods and also as compared with other countries.
(iv) Promotion of economic welfare among the masses by attaining income distribution with distributive justice
(v) Providing better life to the people through improvement or upliftment of the standard of living.
