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What Is the Relationship between Economic Growth and Social Development?

By Troy Holmes
Updated May 17, 2024
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A country's economic growth directly affects the government’s ability to improve the social development of the citizens in that country. Economic growth and social development are tightly correlated because a country needs money to improve the living conditions for citizens. Many people disagree if prosperity should be earned or inherited. Economic growth and social development require a delicate balance of economic growth with a moral social responsibility.

As nations grow, social development should become an important objective. This development typically includes infrastructure, medicine, housing, education, and improved food quality for the society. Economic growth and social development are dependent on each other because a country cannot afford social development without financial capital. A government must be willing to spend new money on improving the social development of the citizens.

The ultimate goal in social development is to improve the well being of all people within a society. Social development requires improvements to available food and clean drinking water. This type of infrastructure is available in most large cities around the world, but is extremely expensive for developing countries. Global economic growth has helped many nations have the necessary funds for clean drinking water and proper sewage sanitation.

A dictatorship is unlikely to have strong social development goals. This type of government typically follows rules and laws based on the objectives of an individual or family dynasty. These governments are generally more selfish and designed to make the ruler wealthy. Dictators may share some national resources with their people, but generally use these for themselves and their families.

Social development should improve as a country’s financial capabilities improve. This development typically takes several decades to occur and requires careful planning. Economic growth and social development are dependent on each other because a country needs economic growth to pay for basic infrastructure needs that support the social development of the nation.

Economic growth is critical for business innovation. Governments that help businesses grow are more likely to improve financially. This additional revenue is later collected through taxes, which can be used to help the social development of the citizens.

Social development is a moral obligation for all countries, but it is also necessary for a country to remain competitive. A country that focuses on improved education and social health is one that is investing in the future of the society. This approach ensures that a country will continue to grow for many decades because the people will be healthier and better trained to create new ideas for continued growth.

Without economic growth, a country may not have the financial resources available to help with social development. Most third-world countries struggle to provide basic infrastructure support for social development. A government can only help the citizens when it has enough money and human capital to improve the infrastructure. Until that capital is raised, a country will continue to struggle with social development needs.

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Discussion Comments
By bluedolphin — On Nov 16, 2014

@donasmrs-- Yes, of course. Just as education, sanitation and health care, participation in social and political life are also part of social development. Innovation and education go hand in hand with economic growth. But it's difficult for people to innovate if they cannot express themselves and their opinions freely.

Just as economic growth leads to social development, social development also leads to economic growth. Citizens who have the opportunities to educate themselves, work and produce will contribute to economic growth.

If any nation has true interest in economic wealth, it must realize that sustainable growth cannot occur without investing in social development.

By donasmrs — On Nov 15, 2014

What about socialist, communist countries? Socialism is about improving the well being and life standards of citizens. And yet, some communist nations like China, limit freedom of speech and other liberties.

Aren't civil liberties also a part of social development?

By ddljohn — On Nov 15, 2014

Although social development cannot occur without economic growth, I don't believe that economic growth is enough. There are countries in the world that are doing okay economically but their social development programs are ineffective because of corruption.

Unfortunately, economic growth doesn't decide how a government spends the money. Even when there are social development programs, lack of accountability and rampant corruption prevents these programs from working.

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