The Relationship between Economic Growth and Economic Development: A Regional Assessment in South Africa

  • Daniel Francois MEYER Spiru Haret UniversityFaculty of Economic Sciences and IT, North-West University, South Africa
  • T. M. MASEHLA North-West University, Faculty of Economic Sciences and IT, South Africa
  • Sebastian KOT Czestochowa University of Technology, Poland Faculty of Economic Sciences and IT, North-West University, South Africa

Abstract

The concepts of economic development and economic growth differ significantly, but are in some instances used as interchangeable notions. It is important for policy formulators and decision makers to understand the relationship between the two. Development strategies should be formulated to achieve sustainable inclusive economic growth and economic development. These two economic concepts influence each other; however, there is limited clarity on the relationship. The aim of the study was to determine the relationship between these in the Vaal Triangle region, South Africa. Economic development is a broad concept and various methods can be used to measure it. For the purpose of this research, an economic development index was developed, which consists of employment, poverty levels and human development index (HDI). This index assists in the measurement of the relationship between economic development and economic growth. A time series econometric model was used to measure the relationship between the two variables. The results indicated that economic development causes economic growth in the long and short run. Therefore, it is important to focus on economic development, through improved HDI, increased employment and poverty alleviation, in order to achieve inclusive economic growth.

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Published
2017-12-02
How to Cite
MEYER, Daniel Francois; MASEHLA, T. M.; KOT, Sebastian. The Relationship between Economic Growth and Economic Development: A Regional Assessment in South Africa. Journal of Advanced Research in Law and Economics, [S.l.], v. 8, n. 4(26), p. 1377-1385, dec. 2017. ISSN 2068-696X. Available at: <https://journals.aserspublishing.eu/jarle/article/view/1547>. Date accessed: 24 june 2024.