What is Economic Development?
Economic development is a process that aims to improve the economic quality of a region or nation. It focuses on increasing the GDP of a region or country. Through increasing the GDP, this process tries to reduce poverty.
It creates jobs and increases incomes, offering better opportunities for the people. The process also includes expanding international trade relationships to boost the economy while opening new markets.
Basic tools of economic development are improved communication systems, energy, and transportation of the area. Government policies promoting trade and investment can play a great role in economic development.
Economic development has only one goal, and that is achieving economic growth. During the process, it does not promote any other awareness. It instead uses natural resources irresponsibly without thinking about the future outcome.
Economic development prefers to move from agriculture-based economies to manufacturing and service sectors. It also fosters entrepreneurship in the local people and encourages them to innovate income ideas.
What is Sustainable Development?
Sustainable development is a holistic approach to progress. This progress is very mindful and does not compromise with the future generations’ needs.
As its name suggests, it is a balanced concept that takes care of economic progress as well as protects the environment. It promotes environmentally friendly technologies.
It prioritizes the preservation of the environment. It aims to decrease the harmful impacts on ecosystems. Issues like pollution and climate change are given the required attention under this process.
Social equity is another essential part of this process. It takes poverty under consideration and makes sure all the members get access to basic needs like education and healthcare.
However, this process is long-term. It creates policies that are beneficial even after a long time. The method of this development motivates businesses to adopt sustainable methods to reduce their environmental footprint.
Taking the current situation under consideration, minimizing waste and recycling are highly encouraged in this process by organizations as well as individuals.
Difference Between Economic Development and Sustainable Development
- Economic development focuses on economic growth and wealth, while sustainable development centralizes on creating a balance between economic, environmental, and social well-being.
- Economic development is a short-term plan for immediate gains, but sustainable development, on the contrary, is a long-term plan that includes the well-being of future generations as well.
- Economic development leads to financial inequality, and on the other hand, sustainable development tries to establish equity.
- Economic development uses natural resources irresponsibly, but sustainable development will use them responsibly as it keeps in mind the future.
- Economic development only keeps individual national growth on the list, but sustainable development focuses on global growth and maintenance.
Comparison Between Economic Development and Sustainable Development
| Parameter of Comparison | Economic Development | Sustainable Development |
|---|---|---|
| Focus | It focuses on economic growth, wealth, and prosperity. | It concentrated on creating a balance between economic, environmental, and social well-being. |
| Required time period | It is a short-term plan that strives to offer immediate gains. | It is a long-term stance that takes into consideration the generations to come. |
| Social equity | This type of development leads to inequality in income and other disparities. | Seeks to establish inclusivity and equity. |
| Usage of resources | This concept uses natural resources mindlessly to achieve short-term gains. | This concept uses resources responsibly. |
| Sustainability | Being environmentally conscious and taking care of society’s well-being is not one of the focuses here. | Being concerned about the ecosystem and maintaining the well-being of present and future generations is the main focus here. |
- https://www.sciencedirect.com/science/article/pii/S1470160X16307531
- https://www.taylorfrancis.com/books/mono/10.4324/9781315722467/economic-growth-sustainable-development-peter-hess
Last Updated : 27 February, 2024
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Chara Yadav holds MBA in Finance. Her goal is to simplify finance-related topics. She has worked in finance for about 25 years. She has held multiple finance and banking classes for business schools and communities. Read more at her bio page.
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Economic development can be shortsighted and detrimental in the long run.
True. Prioritizing sustainable practices is crucial for the well-being of future generations.
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