Economic Development is a term that has many definitions, but essentially, it's a way to create more jobs, attract more businesses, and expand a community's capacity to meet its own needs. Economic development also improves a community's institutional capacity to manage the economy and society.
Economic development has been a growing concern for nations since World War II. The term underdeveloped countries was coined to describe the economies of the former European colonies, in contrast to the developed economies of the United States, Canada, western Europe, and Japan. During that time, poor countries such as Australia and South Africa were considered underdeveloped, and developed countries were those with the highest levels of economic development. In the following decades, the poorer countries began to see rising living standards.
Economic development involves promoting a diverse, robust local economy with employment opportunities for all residents. It also includes attracting new businesses, which can add new jobs, but is not nearly as effective as promoting job growth at existing businesses. Although attracting new businesses is more expensive, it is important for diversifying the local economy.
Recent trends in economic development have created a string of contradictions in the economic development discourse. Some countries have seen unprecedented increases in their per capita income, and have crossed the threshold from low-income to middle-income status. Yet, their income increases have not reduced poverty in the same manner as in the past.
Economic development, as a process of transforming low-income economies into modern industrial ones, has many facets. Economic development is sometimes confused with economic growth, but it is a term that describes both qualitative and quantitative changes in an economy. It is an important concept, especially in underdeveloped countries.
While a key role played by the federal government, it is important to note that economic development is also the responsibility of local governments. The role of local governments is to encourage and protect local economies and ensure a strong local economy. The economic development planning process involves intergovernmental coordination and includes a comprehensive overview of the local economy. It also identifies the strategies necessary to improve the economy. Further, economic development planning plans help local governments determine their economic growth priorities.
In recent years, apartment prices in New York City have skyrocketed, making it more difficult for the city to attract the skilled creative people and businesses necessary to sustain its booming economy. This is especially important for the city to retain doctors, chefs, and other creatives who are vital to the city's economy.
Community economic development projects are a type of development strategy that addresses the economic needs of a community. They often involve community involvement and are planned to meet a community's needs and retain the earnings generated by the project. Moreover, community economic development projects can help catalyze additional economic development initiatives in the future.
Traditional systems of economic development rely on goods, services, and labor. While this type of economy depends heavily on human labor, the government exercises little control over physical resources. Moreover, the distribution of resources is not equitable. This type of system is still prevalent in some parts of the world. It is often common to find it in rural areas in second and third world nations.
While many countries are middle-income, they still have large numbers of people living in extreme poverty. As a result, they compete with poor countries for the attention of the international community. However, this trend does not mean that the middle-income nations cannot achieve the same level of economic development. The best example of this type of economic development is China, which has achieved the greatest reduction in poverty in human history.
Economic development can be a vital part of a community's overall prosperity. The creation of new businesses can provide new jobs for residents in the community and can be particularly important for areas with long commutes. Long-distance workers can benefit from programs that help local businesses create jobs. It's crucial to have policies that support these three avenues of job creation. The economic development element of a community's plan should identify specific projects and programs that support these initiatives.
While Malawi's growth has accelerated, it still has problems such as low productivity in the agriculture sector and limited opportunities in non-farm activities. This situation has increased the risk of political backlash against globalization and migration.
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