As you know both intensive and innovative economic growth are based on the improvement of production factors. So, what is the difference between intensive economic growth and innovative economic growth?
Intensive economic growth - That is conventional and running .
innovative economic growth - Something new to develope the socio-economic activity .
Namiq Abbasov
Extensive means you use more of the same inputs (land, labour, capital, entrepreneurship); Intensive means you use them efficiently and; Innovative means you use new or different techniques or use same techniques, but differently.
Intensive economic growth is fiery and action oriented. Innovative growth is more contemplative and strategical.
Intensive economic growth - That is conventional and running .
innovative economic growth - Something new to develope the socio-economic activity .
The difference between intensive economic growth and innovative economic growth is mainly seen in the context of the use of these concepts. It can be stated that the technologically highly developed knowledge-based economy in certain years was characterized by intense economic growth demonstrated by macroeconomic determinants, e.g. Gross Domestic Product and / or Gross National Product. If, in this economy, key production factors that play a special role in economic development are, apart from classic production factors: land, work, capital - also production factors typical of the neoclassical description of economic processes, i.e. innovation, entrepreneurship, technology and information, then in this regard knowledge-based economy, the term type of innovative economic growth (for a shorter period) and / or innovative economic development (for a longer period) can be used. Currently, highly developed economies compete with each other and improve their comparative advantages in the area of, inter alia, certain modern, innovative technologies. These innovative technologies relate to such areas as: biotechnology, new internet media, Industry 4.0, renewable energy sources, new materials, nanotechnology, etc. In a situation where more innovations are created in a given economy and they constitute a significant factor of production, it should be applied to this knowledge-based economy, the term type of innovative economic growth (for a shorter period) and / or innovative economic development (for a longer period) can be used. Another difference appears in research into the history of world economic development. Developing economies characterized by intense economic growth already existed, for example, in the eighteenth and nineteenth centuries, i.e. during the first industrial revolution. On the other hand, economies in which the key production factors include innovation were only diagnosed in the second half of the 20th century on the basis of neoclassical characteristics of the functioning of highly developed knowledge-based economies, mainly service economies, in which new key production factors appear, which include: innovations, entrepreneurship, technology and information. For these economies, the term innovative growth (for a shorter period) and / or innovative economic development (for a longer period) should be used.
Best wishes
Dariusz Prokopowicz
Innovative growth is more thought, methodical and perhaps sustainable as opposed to intensive economic growth where growth occurs rather rapidly and perhaps in an unsustainable manner. For the latter case when growth continues to occur then the expert economists predict a "correction" when a slump will occur to take care of the non-sustainability.
Intensive growth could be mainly linked to the higher volume of goods and services under a short period of time. We look here at growth according to the quantitative approach.
As to the innovative growth, the focus is on the higher quality of the production. This is a growth responding to the requirement for better standards in the society. For intance, the introduction of the Cash Machine in the banking sector.Innovative growth leads very often to changes in the structure of the economy...
With regards,
Joseph
Quality Vs Quantity. Innovative growth can be ascribed to Quality growth while intensive growth due to quantity.
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