How to measure and characterize economic development?

Here in US for a long time we have relied on data of job creation and job retention to develop our economic strategies. But relying solely on the amount of jobs lost and created has proven to be insufficient and oversimplified. In recent years a new way to track economic development has emerged; by tracking and measuring innovation (process of transforming knowledge into value) index otherwise known as "benchmarking." Through innovation index many states were able to more intricately follow the success of other states compared to theirs. '

Example, source: ncsl.org

"Oregon monitors trend data and compares itself nationally and to eight states that it typically competes with for technology-based development: Arizona, California, Colorado, Idaho, Minnesota, New York, Utah and Washington. The index describes the status of activities in the state ranging from university licensing income (payments from firms for the use of university technology) to the number of scientists and engineers in the workforce. Indicators that appear in the innovation index come from research by a variety of organizations that specialize in the topics. Overall, the state gives itself a B"

Thank you very much. Do you know any article or a book about tracking economic development?

There is no one single academic work/study that would be sufficient enough to satisfy your research. I would suggest reading on several sources that cover both economical development and political regulations that affect the overall commercial progress.

Andreas Bergh's paper on "Government Size and Growth: A Survey and Interpretation of the Evidence" would definitely be of interest for your.

PS If you feel bored here is something I found absolutely hilarious from University of Helsinki and their correlation between economic growth and penis size.

http://www.businessinsider.com/academic-paper-economic-growth-penile-length-2012-7?op=1

It all depends upon the constitution, form of government and long-run policies of the country, for example India during 1980s and1990s.