Explain the main factors that influence the rate of economic growth
Economic growth will be different in M.E.D.Cs than it will be in
L.E.D.Cs. The reason for this is that M.E.D.Cs are already developed
and vast improvement may not be possible but in L.E.D.Cs they have a
long way to catch up so it is easier for them to expand vastly.
Economies like China and India have potential for vast economic growth
because of a huge population. If these countries got their act
together then they would be the world leaders. These two countries
alone account for 40% of the worlds population.
Land- Different countries possess different amounts of land, it is
defined as all natural resources not just land itself. For example
Saudi Arabia without its oil would just be another poor third world
country. The U.K s land became richer with the discovery of oil fields
in the North Sea which have only become exploited since the mid 1970s.
Today oil contributes to about 3-4% of G.N.P. However the exploit of
raw materials is unlikely to be a significant source of growth in
developed economies, although it will be vital in developing countries
e.g. Nigeria- if they found oil in their land then they will become
richer and worth more instantly.
Labour- Increasing the number of workers in an economy should lead to
economic growth. Increases in the labour force can result from three
Changes in Demography- If more young people enter the workforce and
then leave it, the size of the workforce will increase....