Economic growth manifests itself in the accumulation of factors and technical progress. Such changes create impact upon trade through the variations in the pattern of production, consumption and the international terms of trade. In this article we will discuss about the production and consumption effects of growth on trade. Production Effects of Growth: As the process of economic growth facilitates [...]
In this article we will discuss about the theory of immiserising growth. The process of economic growth may bring about an increase in level of output in the growing economy and the wealth effect may even be positive but the deterioration in the terms of its trade may be so large that it more than offsets the positive wealth effect. [...]
We shall explain below Joan Robinson's model of capital accumulation and growth which is suited to the labour-surplus conditions of less developed countries. Harrod and Domar extended the Keynesian analysis of income and employment to the long-run setting and therefore considered both the income and capacity effects of investment. Harrod and Domar models of economic growth explain at what rate [...]