1) Economic growth vs economic development (must-differentiate)
- Economic growth: increase in real national income/output (e.g., real GDP).
- Economic development: broader improvement in living standards (health, education, equality, capabilities), including structural change.
CUET framing: growth is necessary but not sufficient for development.
2) Measuring growth (basics)
- Real GDP growth rate: % change in inflation-adjusted output.
- Per capita income growth: GDP per person; closer to living standard proxy.
- Productivity growth: output per unit input (e.g., labour productivity).
3) Structural change: meaning
Structural change refers to long-run shifts in:
- sectoral composition of output (agriculture → industry → services),
- employment shares across sectors,
- technology and productivity.
Typical development pattern
- Agriculture share in GDP falls over time.
- Industry rises (often), then services rise.
- Employment shifts more slowly than output.
4) India’s structural transformation: key features (exam-friendly)
4.1 Services-led growth (often highlighted)
India experienced significant rise in services’ share of GDP.
- IT, finance, communications, trade, etc.
4.2 Employment shift slower than output shift
A large share of workforce remains in agriculture relative to agriculture’s GDP share → implies:
- low agricultural productivity,
- disguised/underemployment.