The Theoretical and Methodological Aspects of Economic Growth and Economic Development
Pasichnyk T. O.

Pasichnyk, Taras O. (2024) “The Theoretical and Methodological Aspects of Economic Growth and Economic Development.” The Problems of Economy 2:213–222.
https://doi.org/10.32983/2222-0712-2024-2-213-222

Section: Economic theory

UDC 330.34-027.21

Abstract:
The aim of this article is to provide a theoretical and methodological substantiation of the conceptions of economic growth and economic development in the context of their interconnection and differences. This is achieved through the prism of the dialectical approach, synergistic approach, normative approach, cyclical theory of economic development, economics of happiness, and theory of sustainable development. The main reasons why economic growth should not be considered as a process identical to economic development are highlighted. It is substantiated that economic development is a more expansive concept than economic growth, which is a component of economic development. Economic growth is perceived as a desirable outcome of economic activity, while economic development, due to its dialectical nature, is progressive and regressive, involving alternating stages of growth and decline. In cyclical theories, economic growth typically coincides with the upswing phase of constantly repeating cycles of economic development. The analysis indicates that there is no singular methodological approach to determining the level of economic development. In contrast, economic growth is typically assessed based on GNP and other metrics. Development economics employs a range of indicators, including life expectancy, poverty, unemployment, income inequality, education, healthcare, happiness, freedom, and others. From the perspective of sustainable development economics, an excessive focus on quantitative indicators of economic growth without considering the cumulative effects of economic activity can be described as "growth without development." This approach may jeopardize the long-term progress of humanity. It is substantiated that economic growth can be predicted within a certain time period, provided that the economic system maintains relative stability at the same level of development. Conversely, economic development is a challenging to predict process, dependent on random fluctuations that cannot be predicted. Consequently, the modeling of economic development necessitates the convergence of the exact and social sciences, interdisciplinary synthesis, which represents an important area for further research.

Keywords: economic development, economic growth, sustainable development, happiness economics, economic cycles, indicators of economic growth, indicators of economic development.

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Pasichnyk Taras O. – Candidate of Sciences (Economics), Associate Professor, Associate Professor, Department of Management of Foreign Economic Activity, University of Customs and Finance (2/4 Volodymyra Vernadskoho Str., Dnipro, 49004, Ukraine)
Email: taras.pasichnyk@gmail.com

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