Classical Theory Of Economic Growth

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Economic growth is increase in the goods and services produced by an economy, typically a nation, over a long period of time (Economic Growth, 2018). Economic growth has different theories which are classical theory, neoclassical theory and new growth theory. The classical theory is a combination of economic work done by Adam Smith, David Ricardo and Thomas Robert Malthus in the eighteenth and nineteenth centuries. The theory stated that economic growth will end up due to the population growth and limited resources (Investopedia, 2018). The neoclassical theory is an economic theory that outlines how to achieve a steady rate of economic growth through the appropriate number of labor, capital and technology (Investopedia, 2018). The new growth …show more content…
This is because GDP at purchasing power higher than other years, which was $ 3.92 trillion. In contrast, the real gross domestic product (GDP) rate in year 2013 was the lowest percentage throughout 17 years (2001-2017), which was 3.2%. This is because the poor performance in agriculture, manufacturing, and mining sectors (The Times Of India Business, 2013). The real gross domestic product (GDP) rate of India in year 2017 was lower percentage than year 2016, which was 0.9% (2017= 6.7%, 2016= 7.6%) (GDP- real growth rate, 2018). The reason is the consumer demand was hit as demonetization caused a cash crunch in the economy (Quora, …show more content…
In contrast, based on the International Monetary Fund (IMF), India’s gross domestic product (GDP) is expected to grow 7.4% in year 2018 and become the fastest growing country in economies. India’s economic growth came about after last year’s economic slowdown and the implementation of goods and services tax (Business Today, 2018). Malaysia has experienced much economic and political turmoil over the past 40 years. The traditional export economy renewed the production of rubber manor and rubber trees through a very successful project in 1950s and 1960s. As Malaysia becomes the largest oil palm producer in the world, the export economy recovered again in the 1960s and 1970s. In the 1970s and 1980s, the utmost vital of the source of Malaysia’s economic growth was the massive oil and gas industry and manufacturing sector (Drabble, John H.,

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