This can be doubted. Many countries are in recession or pre-recession. Pre-recession indicators point to an impending crisis in the world's nominally largest economy, the United States of America.

In the short term, economic growth is caused by increased aggregate demand (AD). Thus, it can occur in a particularly uncertain crisis. One example is when the US government issued stimulus checks due to the COVID-19 pandemic. These checks gave individuals more disposable income, which allowed them to spend more, increasing consumer spending. Additionally, If there is spare capacity in the economy, an increase in AD will cause a higher real GDP.

There are two main sources of economic growth: growth in the size of the workforce and growth in the productivity (output per hour worked) of that workforce. Either can increase the overall size of the economy, but only strong productivity growth can increase per capita GDP and income. The temporal aspect of economic growth, dear Mohammed Asseel , is therefore based on the realization of dynamic efficiency, i.e. dynamic and efficient allocation of

• Natural resources.
• Human resources.
• Technology.
• Capital formation.
• Dynamic efficiency is influenced by, for example, research and development, investment in human and non-human capital and technological change. It is when all resources are allocated efficiently over time, and the rate of innovation is at the optimum level, which leads to falling long run average costs.
• In terms of the: Golden Rule capital stock in the Solow Growth Model
• https://www.csus.edu/indiv/v/vangaasbeckk/courses/100a/sup/goldenrule.pdf
• rapid economic growth can occur in short-term or time, in the sense of a speedy human learning curve for value creation (learning that pays).

Mohammed Asseel PS/https://www.thoughtco.com/singapores-economic-development-1434565#:~:text=In%20the%201960s%2C%20the%20city,strongest%20economies%20in%20the%20world.

Cases studies can help us to learn about successful short-term transitions towards economic growth.

Thanks, All DR/ Szymon Piotrowski , DR/ Budhadev Mahanta , DR/ Stephen I. Ternyik .

@Mohammed

Yes, economic growth can occur in a short time, means an increase in Gross Domestic Product in a given period of time.under the assumption is that the resources are available and obviously growth is driven by effective demand.

Best regards

The question is somehow peculiar. Martha mentioned that economic growth is simply an increase of GDP against the period before. If one looks into National Accounts statistics of different countries, one can observe many growth periods (years, quarters). I assume that monthly GDPs are, in general, not calculated. Nevertheless, it is likely that production within shorter periods fluctuates much more that for longer ones. That means that shorter-term growth occurs more often (shrinkages, of course, too. Contrary to Stephen, like Martha and Budhadev, I hold demand for much more important than natural resources, technology, capital etc. - especially in the short run.

By the way, I think, that econmists lay too much weight on GDP growth. (High) growth should not be a goal by itself, but can be a means to improve the standard of living of the population.

Dear Anton:

First, I really appreciate your comments on economic growth. As you know, economic growth, is very important to create jobs and produce goods and services.

However, Economic growth throughout history has shown that by itself it is not inclusive, that is, only the highest groups in the social pyramid have been favored. In this context, the participation of the State in supporting the poorest social groups is very important, and it´s applied in most countries.

The Mexican government, as part of social policy, has extended monetary aid to vulnerable groups (older adults and young people).

I share the recent results: "Poverty is collapsing in Mexico. Almost nine million Mexicans have left the lowest economic threshold between 2020 and 2022, according to the latest report from the National Council for the Evaluation of Social Development Policy (Coneval). The The number of people in poverty remains high—46.8 million Mexicans, 36.3% of the total population—but has improved radically in the last two years. So has extreme poverty, which has dropped by 1 .4% in the country. Coneval data reveal at the same time that during this time the educational gap and especially the lack of access to health services in Mexico has increased. source. El Pais (newspaper on line; august 23th, 2023.).

Best regards

Thanks. DR/Martha Pantoja , DR/Anton Rainer

Aside from the answers given by our esteemed colleagues here, I think GDP as the primary measurement of "growth" lacks the value of workforce efficiency as well us how specific policies will or shaped that "growth" that we are trying to account. I think, the better calculation of growth occurrence (if we will try to relate it with short term measurements) should be the comparison of all factors and externalities against another jurisdiction or country who has similar economic conditions with the economy being observed.

While it is possible to move the economy in a certain direction through planning and policies, the question of sustainability/longevity overtime should be raised as well. If Country A decides to implement rules against fossil fuel companies, we can hypothesize that renewable/clean tech industries could rise. But, there are other factors that we should account and those include the availability of manpower (and resources) to make a specific industry grow through production and competition by means of innovation. I think this hypothesis could be applied to the general economy which is composed of different industries. Mohammed Asseel

Dear Dexter:

Gross Domestic Product is a quantitative measure (is the standard measure of the value added created through the production of goods and services in a country during a certain period); The Development of a country is measured by human development index (HDI) is an indicator, developed by the United Nations Development Program (UNDP), that is used to classify countries into three levels of human development. The index is composed of life expectancy, education and per capita income indicators (is a qualitative indicador.

Best regards

Martha Pantoja yes ma'am. A bit aware of those things you mentioned. The only thing that I am proposing here is the argument that GDP alone (as the primary capitalist tool for quantifying economic growth) or any tools/metrics does not account other factors at hand. I would like to put GDP on trial this time. If we really want to measure more precisely the growth of economies, we must have a tool that includes almost everything that is important not a set of tools that can possibly be in conflict with each other. If we will use separate quali or quanti tools, we must raise the question of causality or correlation between the results drawn out from these tools. Sometimes we prefer to use the interpretation of one tool over the other. We can use them all but I would like to hypothesize that we have biases over few of them especially GDP and GNP making all results from other tools left behind/unconsidered.

As a conclusion, it is also my formal argument (base case) that I am not that comfortable with how we measure our economy that is why the relevance of growth over specific time period sounds incomplete to me.

Much of the discussion i have read does not actually seem to be directed at the question that was asked. Regardless of whether growth is measured by GDP, or related measures such as real GDP or GDP per capita, or more exotic measures, there is a simple response to the question as asked: A long run (however long) is a sequence of short runs. If growth could not occur in each short run period it could not happen in the long run.

If the question is really about what things can affect growth in the short run versus the long run that is a far more complex matter, though things that affect growth in a given short run period may, if not repeated, have little effect on long run growth. Short run shocks of many types from storms and earthquakes to election turmoil can be like that. However if a storm is the result of a change in climate that has altered the likelihood of storm like it in future short runs then there will be long run changes in growth as a result. Similarly, if the election turmoil is due to an underlying change in social stability which affects expected profitability of investment--there will be an impact on long run growth.

Thank you, prof/Neil H Garston

Neil, the question was on short-run (not: long-run) growth. The simplest answer to the question would be: of course. Your sentence:"If growth could not occur in each short run period it could not happen in the long run", is not correct. If GDP or any other variable at the end of a period (which is defined as long-run) is higher than at the beginning, there was long-run growth, even if there were (short-run) sub-periods with negative changes. What concerns growth rates: In general, one can observe a negative corrrelation between GDP level and percentage growth (not unexpectedly,as growth rates are calculated by dividing by the past level). I prefer a high GDP (inasfar it is connected with a high standard of living of the population to high growth (which by the way could be damaging in the future). Exponential growth is not wishable and not possible in the very long run (often ignored in economics).

Short term economic growth is possible, thought it can be volatile and subject to fluctuations due to unexpected events or global economic conditions. but long-term economic growth driven by structural changes and productivity improvement is more desirable and sustainable.

Yes, economic growth can occur in the short term, but it is important to note that economic growth is a complex process that depends on various factors such as political stability, technology advancements, and social welfare policies, it is difficult to predict the outcome of any economic policy.

Thank you, DR/Chuck A Arize

It depends on how we measure the growth, that would be a major determinant of our growth in the short-run or long-run. I would prefer looking at growth from a development perspective and not just an increase in productivity(GDP),

Most economists seem to have forgotten that the main economic goal is or should be a good life (standard of living) for the population. In general, this is measured by GDP. Even if one sees this measure as problematic, one could accept it, if it is enriched by additional indicators of well-being (health, education, distribution etc.), which -by the way - are often highly correlated with GDP. But instead of looking on GDP (per capita), many economists see (percentage) growth as the main economic variable. I prefer to live in a country with a high GDP and standard of living with low or no GDP growth than in a country with high growth, but with low GDP and a poor standard of living. I would also prefer high short-term growth for some time (even followed by low growth afterwards) to long-term growth (which would likely create more problems than it solves).

If economic growth can occur in the short term as my colleagues already mentioned, goods and services can be produced in a specific period of time (typically a year).

However, sustainable economic growth can´t be maintened in the long term, since some time ago.

Likewise, as Anton points out, economic growth has become very exclusive, since only one sector of society has benefited from it.

Dear Martha,

In an economy, there usually is production (value added) every day. Therefore, there may be growth (or shrinkage) from day to day (principally even hourly). Nevertheless, it would not make sense to estimate GDP (= sum of domestic value added) for such short periods), but in many countries, there are estimates for the quarterly GDP, i.e. it is possible to calculate a quarterly growth rate.

One should always have in mind, that GDP is an estimate, and there are a number of conventions and imputations and missing data, and, I think, the bias vis-a-vis the "true" GDP (whatever that is) might be larger than an average growth rate. Of course, the bias for short periods is higher, and there are, in general, more and more reliable data (annual book-keeping and tax rules) for the annual estimate. It is also easier to assign transactions to the period in question (date of delivery).

According to the evidence, economic growth occurs in the short term; In the case of Mexico it is measured quarterly. The Gross Domestic Product can be measured in real or nominal terms. The important factor is to know what happens with countries with high inflation rates, as is the case of Argentina currently, for example. The question is whether inflation eats into economic growth.

Mild inflation will likely be favourable for growth, unless incomes of important parts of the population (e.g. wages, pensions) are not adjusted accordingly. With high inflation, growth becomes less important, the main problem will be to stabilize the economy. By the way, inflation will likely cause biased results for the calculation of real GDP and real growth rates - especially short-run ones.

When answering the question, it is necessary to pay attention to the definition of terms. There are different concepts of economic growth. The core definition is in terms of growth in the long run productive capacity of the economy (typically measured by growth in real GDP). GDP Growth can be measured in terms of, or supply. The growth in demand can outstrip supply for a while by borrowing, but is ultimately constrained by the income generated by supply.

GDP does not measure productive capacity, but the production in a country within a certain period. What concerns demand and supply, GDP can be seen as the minimum of both. With decreasing demand, an economy will likely not increase productive capacity and growth wil be low (or GDP will shrink.

By the way, I do not understand how demand growth /e.g. higher foreign demand leading to higher exports) can outstrip supply by lending. Of course, notional demand could be higher than capacity, but finally demand cannot exceed supply vice versa.

Yes, it can be achieved through increased government spending or lowering interest rates.

Yes, economic growth can occur in the short term.

It is referred to as an increase in aggregate production in an economy.

Yes, it can occur.

Yes, economic growth can occur in the short term, although the magnitude of growth may vary depending on several factors such as government policies, business cycles, external shocks, and technological advancements.

Short-term economic growth often stems from factors like increased consumer spending, investment, government expenditure, and exports. These factors can stimulate economic activity, leading to an expansion of production, employment, and income levels in the short run.

However, sustained and robust economic growth typically occurs over the long term rather than the short term. This is because long-term growth requires structural changes in the economy, such as improvements in productivity, innovation, human capital development, and institutional reforms.

The economy plans its Developmental for long period. But in short term results are to be produced. Economic growth by its definition is growth in terms of quantity. Factor variables do not change here. But we can see growth in short run as its 5 year plan. Many programs are conducted in short run which produce positive results.

Mohammed,

I want to add that economic growth needs to occur in the short term, because If there is no economic growth, social and political problems arise.

Best regards

Yes, economic growth can occur in the short term,

Yes, economic growth can occur in the short term.