Economies grow because of several factors. One of these factors is the increment in the supply of labor. This is because when there are more people working it means that the production increases. This has the impact of economic growth. This occurs along with adoption of the concept of economies of scale. Economies of scale ensure that the production is continuous with at least one person doing what would have been done by two or more people at the same time. On the same note, specialized labor provides an opportunity for massive and quality production. This means that the production output meets the desired expectations and quality thresholds. This occurs since the specialized people have the ability and power to focus more on production by spending less time while ensuring the output is maximum.
Having a specialized capital is another factor that ensures that economies grow. This means that an individual has the ability of allocating adequate resources and acquiring all the necessary materials to ensure that the production output is maximum and beyond the expected level (McGrath, 2012). Technology also plays a significant role towards economic growth. Technology provides a platform for improving the time requirement for production. This occurs through making work easier while using tools, equipment and machinery that provide an opportunity for effective interaction and communication among the key players of economic development. This includes allocation and management of the various resources used in the economic development effectively.
Infrastructural growth is a key indicator of economic growth in country. Therefore, infrastructure contributes significantly towards the growth and sustainability of economy. Transportation provides a means of movement of all the factors of production and improves the quality of life of the people. This includes ensuring that citizens have the ability of accessing both domestic and international markets easily so that the movement of raw materials from one place to another occurs effectively (FOROOHAR, 2012). The other critical factor for economic growth is management. This is because when two individuals are subjected to the same working environment they tend to be more productive than when they are subjected to different working environment, but doing the same job. As such, having an effective means of coordinating the functions of people in various working environments ensures that the production output is very high. This includes technological advancement, which enables keeping track of what is happening in terms of accounting, arithmetic and writing functions are involved. This boosts the economy significantly.
Economic growth is desirable to all nations. This is because it aids in reducing the gap between the rich and the poor, it reduces the poverty levels in a nation, and it improves the quality of life of the citizens. However, sustainability of the economic growth is a common problem that several nations face. This occurs due to the constant fluctuations in the currency. This makes some resources to be accessible while others to become quite an accessible (Ding, & Knight, 2011). This means that nations have to focus on monitoring their economic performance in order to ensure a continuous sustainable growth. Factors such as global warming and other environmental based factors may impact the economic growth of a country negatively. Consequently, such a country will not enjoy a sustainable economic growth. Social and political factors have to be balanced with economic based factors to ensure that the country has a sustainable economic growth.
References
Ding, S., & Knight, J. (2011). Why has China Grown So Fast? The Role of Physical and Human
Capital Formation. Oxford Bulletin of Economics & Statistics, 73(2), 141-174.
FOROOHAR, R. (2012). WHY STOCKS ARE DEAD: (And Bonds Are Deader). Time,
180(22), 40-44.
McGrath, R. (2012). How the Growth Outliers Do It. Harvard Business Review, 90(1/2), 110
116.
