Economic Growth

Definition

Economic growth refers to an increase in the production of goods and services in an economy over time, usually measured as the percentage increase in real GDP. This growth is often driven by factors such as technological advancements, capital accumulation, and labor force increases, influencing various social and political aspects, including reform movements and immigration patterns.

5 Must Know Facts For Your Next Test

1. Economic growth in the Gilded Age was fueled by industrialization, which transformed the U.S. economy and led to a rise in living standards for many.
2. Immigration during this period contributed significantly to economic growth by providing a labor force for expanding industries and filling job vacancies.
3. The early Republic saw initial economic growth through agriculture and trade, setting the foundation for future industrial expansion.
4. After 1945, the U.S. experienced unprecedented economic growth due to post-war industrial expansion, technological innovation, and increased consumer demand.
5. In recent decades, economic growth has shifted towards technology and service industries, reflecting changing patterns in employment and production.

Review Questions

• How did economic growth during the Gilded Age influence social reforms?
  • During the Gilded Age, economic growth created significant wealth disparities and poor working conditions, which spurred social reform movements. Activists sought to address issues like labor rights, women's suffrage, and social justice as a response to the rapid changes brought on by industrialization. This environment fostered organizations that aimed at improving living conditions and pushing for legislative changes to protect workers and marginalized groups.
• Evaluate the role of immigration in driving economic growth during the late 19th century.
  • Immigration played a critical role in driving economic growth in the late 19th century by providing a steady influx of labor necessary for industrial expansion. New immigrants filled low-skilled jobs in factories and construction, which supported growing urban economies. Additionally, their diverse skills and entrepreneurial spirit contributed to innovation and job creation in various sectors. This wave of immigration not only boosted production but also shaped cultural dynamics within American cities.
• Analyze how economic growth after 1945 transformed American society and its global standing.
  • The economic growth experienced after 1945 significantly transformed American society by leading to an era of prosperity characterized by rising consumerism and the development of a strong middle class. This period saw advancements in technology and infrastructure, which positioned the U.S. as a global leader in innovation. Furthermore, this economic boom enabled the U.S. to exert considerable influence in international affairs, establishing itself as a key player in shaping global economic policies through institutions like the IMF and World Bank, reflecting its robust economic standing.

Related terms

Industrialization:

The process of developing industries in a country or region, leading to increased production capacity and economic changes.

Urbanization:

The movement of people from rural areas to cities, often driven by the search for jobs and better living standards resulting from economic growth.

Capitalism:

An economic system characterized by private ownership of the means of production and their operation for profit, often associated with industrial growth.