Economic growth is the increase in the ability of the economy to produce services and goods from one year to another (Barro, 2004). The economic growth can be measured using real terms or nominal terms. Nominal terms include inflation while real terms involve making adjustments for inflation. The economic growths of different countries are compared against each other using GDP (Riley, 2012). GDP is a method that takes into consideration the different populations of the countries being compared against each other. The economic growth of a country also influences the living standards of its population. The new growth theory Continue reading...