Types and factors of economic growth

The economic growth of any country is determined by six major factors, four of which are related to the physical ability of the economy to grow, the offer or the availability of resources.

These are:

1. The quantity and quality of natural resources.

2. The quantity and quality of labor.

3. The volume of fixed capital.

4. Technology.

By way of the impact on economic growth are distinguished:

- Direct.

- Indirect.

Direct -the factors that determine the physical ability of the economy to grow. These include: the amount and quality of natural resources, the quantity and quality of human resources, the level of capital, technology and growth of entrepreneurial skills in the community.

They can be grouped under the name of supply factors.

Indirect - affect the ability to turn that ability into reality. To them include: reducing the degree of monopolization of markets, reduction of prices of inputs, reduced income taxes and expansion of access to credit.

On the other hand, growth is dependent on the demand side, by making full use of the resources and expanding their distribution so as to obtain the maximum amount of useful products.

There are two ways of economic growth: extensive and intensive.

In extensive type of economic growth achieved by the quantitative increase in the factors of production, while preserving the same technical framework: built additional capacity, new mines, new jobs are created. In agriculture, are involved in the commercialization of new tracts of land, as was the case in the 50's during the development of virgin and fallow lands.

With the dramatic increase in the type of growth of output and the improvement of its quality is achieved through better utilization of the available production capacity and growth yield of the final product with each unit involved in the production of resources.

Source of economic progress incorporated in mainstream industrial relations in their respective productive forces. Outdated industrial relations weaken economic interests of the person, team and businessman. Conversely, in the terms of the relations of production to the needs of developing the productive forces of the economic interests and act filled accelerator of economic progress.

Intensification of economic activities may adversely affect the surrounding area. And vindictive nature of unreasonable actions, it can punish a person. Hence the inevitability of the following conclusions:

1. The development and implementation of new technology should carefully consider the immediate and distant environmental impacts of decisions.

2. In the justification of projects, feasibility of solutions - include costs for environmental protection.

3. Preference is given to a closed, non-waste technology.

4. Predict possible changes in the quality of human life, in its economic and moral behavior.

5. With the transition to a mixed market economy, the emergence of mixed and joint enterprises with foreign firms to consider the potential environmental impacts of such enterprises. Experience shows that such firms in order to save money on environmental protection and tight control over their activities in their countries do not take away is not quite "clean" production outside the metropolis.