EC140 Lecture 11: EC-140 Lecture 11
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EC140 Full Course Notes
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Rising living standards: normally measured by real per capita gdp, median income may be a better measure of common living standards. Higher incomes lead to many better outcomes. Increases in consumption: better health status, higher life expectancy, easier to redistribute in a growing economy, more attention to environmental issues. Higher investment requires less consumption: tradeoff between consumption now and in the future. Economic growth may bring less stability: creative destruction, structural unemployment. Increases in economic growth commonly lead to increased use of environmental resources: arguments that environmentally friendly growth is possible are fairly weak. Growth may not increase overall well-being: relative income matters. If growth leads to inequality overall well-being may fall. Economic growth may not be the right measure: productivity may be more closely related to well-being. Growth in the labour force: growth in population, or labour force participation rate.
