The Impact of Economic Growth (AQA A Level Economics)

The Costs & Benefits of Economic Growth

• When evaluating the impact of economic growth, it is useful to consider both the cost and benefits it offers to society 

Evaluating Economic Growth 

The Impact of Economic Growth on key Stakeholders

The impact of economic growth on individuals

• Economic growth can lead to an increase in income levels for many individuals. As businesses expand and create more jobs, individuals may experience rising wages and higher income

• However, the benefits of economic growth may not be evenly distributed. Higher-income individuals, particularly those who own assets or hold positions in industries experiencing significant growth, may see disproportionately larger increases in their incomes compared to lower-income individuals, which can result in significant disparities between the rich and the poor

The impact of economic growth on the economy

• With economic growth, several macroeconomic goals can be achieved. Employment rates may rise, standards of living might improve, and there's potential for increased investment in education, healthcare, and infrastructure

• However, it's crucial to note that high levels of economic growth may also lead to elevated inflation, making exports more expensive
  

The impact of economic growth on the environment

• The pursuit of economic growth often comes with negative externalities. This includes an increase in air pollution, the generation of plastic waste, and the degradation of natural resources

• Rapid economic growth can lead to increased demand for natural resources, potentially resulting in overexploitation and depletion of these resources. This can have detrimental effects on ecosystems and biodiversity

• It can lead to higher levels of waste production. Inadequate waste management practices can result in pollution and environmental degradation

• The environmental costs associated with growth can have lasting consequences on ecosystems and public health