The term economic growth draws our attention to “size” or “quantity”. It has a “quantitative dimension”. It is also a sustained increase. It refers to an increase in size or output of goods and services produced in the economy over a period of time ie national income.
It also means greater efficiency which implies increase in output per unit of time ie increase in Per Capita Income. Therefore economic growth is not an end in itself. It is an important tool for increasing employment and the standard of living of the people.
Economic growth is a universal but there is no universally accepted definition of the term.
It is quite possible that at times there is a visible decline in income and output. This is a situation of NEGATIVE GROWTH.
At times there is neither an increase nor decline in income and output. This is a STATE OF STAGNATION.
Growth may be lop sided or not quite balanced, this is a situation of UNBALANCED GROWTH
If growth is all round then we have a situation of BALANCED GROWTH.
Different economists have defined economic growth in different ways.
1] According to J K Mehta “Economic growth indicates a quantitative increase in national income”.
2] According to Prof Miller, “Economic growth is a process whereby, an economy’s real per capita income increases over a longer period of time”.
3] According to Prof Simon Kuznets, “Economic growth is a long term rise in capacity to supply increasing diverse economic goods to its population, this growing capacity being based on advanced technology and the institutional and ideological adjustments that it demands”.