10/05/2005 1:05:09 pm
The Importance of Economic Growth. There is a lot of returning criticism against GDP as a measure of prosperity. Some is relevant, some is just made up by people who dislike growth and the kind of society it requires. There are, however, many other ways to measure the effects of a growing economy - as opposed to an economy where the resources are just redistributed. One example is that the average person in the US in the year 1875 spent 75 per cent of the income on food, drink, clothes and housing. In 1995, the share of the income to those needs just amounted to 12 per cent. That is, a growing economy had created so much higher an income that only a smaller share had to go to these fundamentals. And yet they were of better quality too in 1995. Much more was left to other consumption. Growth gives people opportunities.