Economic Growth: Institutions and Investment

These flashcards cover key terms and concepts related to economic growth, investments, and the institutions that support them.

Economic Growth

An increase in the wealth and economic prosperity of a country, leading to higher societal well-being.

Infant Mortality Rate

The number of infant deaths per 1,000 live births, an indicator of healthcare quality in a nation.

Per Capita GDP

The measure of a country's economic output that accounts for its number of people, commonly used to gauge the economic performance.

Physical Capital

The stock of tools, machines, structures, and equipment used in the production of goods and services.

Human Capital

The skills, knowledge, and experience possessed by an individual or population, crucial for economic productivity.

Technological Knowledge

Understanding of how to produce goods and services and the methods for improving efficiency in production processes.

Institutions

The 'rules of the game' that structure economic incentives and guide the behavior of individuals in an economy.

Property Rights

Legal rights to use and derive benefits from a property, essential for encouraging investment in physical and human capital.

Investment

The creation of new capital aimed at producing more future output.

Depreciation

The reduction in the value of capital goods over time, due to wear and tear.

Catch-Up Effect

The phenomenon where less developed economies grow at a faster rate than more developed economies, due to capital and labor adjustments.

Diminishing Returns

The principle that adding more of one factor of production, while keeping others constant, will yield progressively smaller increases in output.