GROWTH & ECONOMIC DECISION ¶
By: Eliah Radithya(Asgardian) on 1 August 2017, 4:30 a.m.
In the world of economy we recognize the economic growth. Economic growth is defined as an increase in GDP / GNP regardless of whether the increase is greater or less than the rate of population growth, or whether changes in economic structure occur or not. However, economists generally give the same meaning. They mean growth or economic development as an increase in GDP / GNP only. In more general usage, the term economic growth is usually used to state the development in NSB (developed countries).
Finally a new economy can be expressed in a developing state if per capita income shows an interesting long-term trend. However, this does not mean that per capita income will increase steadily. The existence of an economic recession, political turmoil, and economic downturn, for example, can lead to an economy experiencing a decline in the level of its economic activity. If such conditions are only temporary and economic activity on average increases from year to year, then the community can be said to experience economic development.
The notion of GDP and GNP is not the same. In GNP use the term "National" because the limit is National citizenship. While GDP limits are the territory of a country, including foreign people and companies. Economic growth is said to have occurred if within the society there is a change of important characteristics of a society. For example the changing state of the poetic system, social structure, value system in society and its economic structure. A society that has achieved such a process of economic growth, where economic growth has begun to occur frequently can be considered already at the prerequisite stage of take-off. The prerequisite stage of take-off is a transitional period in which the community prepares itself to achieve growth on its own strength. At the prerequisite stage of take-off and thereafter, then economic growth will occur automatically.
In achieving the prerequisites of taking off in economic growth the advancement of the agricultural sector has an important role in the transition before it takes off, the role of the agricultural sector, among others, agricultural progress ensures the provision of food for rural and urban population. This ensures people do not starve and conserve foreign exchange because of the importation of foodstuffs. In addition, the increase in productivity in the agricultural sector will expand the market from various industrial activities. Increase in farmers' income will expand the consumer goods industry market, increase agricultural productivity will expand the industrial market.
Apart from the agricultural sector, economic growth is also supported by several things, among others;
1. In the industrial sector, economic growth is incorporated in increasing the supply of factors of production (population, labor, capital accumulation) and the rate of technological progress.
2. The economy in full employment and individual capital goods in the community is used in full.
3. The economy consists of two sectors, namely the household sector and the corporate sector, meaning that the government and foreign trade do not exist.
4. The amount of public savings is proportional to the amount of income naional means the function of saving starts from the point of zero.
5. The tendency to save a fixed magnitude.
6. Capital accumulation, including all new investments in the form of land (land), fiscal equipment, and human resources (Human Resources).
7. Economic growth
8. Technological advances.
Thus, it is clear that economic growth is the ability of a country to provide the ever-increasing economic goods for its population growth, this capability based on technological and institutional advancement and the ideological adjustment it needs.
A country that has a high rate of economic growth, then there will be equality of the results of economic growth itself. Equity here is not just dividing the already large cake, but more important as it increasingly involves the people in the overall economic development through ownership of assets and access. Economic equity in the fulfillment of basic needs such as food, clothing, other basic needs and also the income of the population itself is strongly influenced by the economic growth itself. Whereas in the case of development with high economic growth, the distribution of development will encourage regional development through autonomy.
In the case of equitable distribution of development and economic equity that must be leveled is the process, not an obstacle, although it requires the consequences of progress in various sectors. Actually equity should be done for growth and not vice versa.
In the case of equitable distribution of development and economy should not be distributed evenly or equated, because given the conditions or needs of each region is different. In the equity to be addressed, it is necessary to thoroughly the condition of each of the targeted areas to determine its allocation system. In realizing a development strategy that is based on equity to achieve high economic growth, the government has the most central and big role.
Because development depends not only on the creation of high economic growth in the realization of a better quality of life, equity and social justice. Development should place the interests of the people in the first place. If it is not tapered the economy of the people is gaping, rich people are rich and poor. Economic equity is one way to create camaraderie in society, the increasingly widening economic inequality of a society will lead to severe social upheaval, if not as early as possible the problem of economic equality must be quickly realized. Therefore, in the constitution, the government has a big role, certainly not limited to efforts to eradicate poverty through the provision of funds but more than that the problem is on the construction of various basic facilities such as education and health that began to allow for the whole Asgardia community both in the present Or later on. There is a need for the role of government to take control, besides that we also must realize also its ability in equalization of economic development result such as smaller development, therefore needed also will cooperation and role from private sector.