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Thus by the term economic development we mean a process so as to raise the per capita output with a scope for equitable distribution. Meier has rightly said, “We shall define economic development as the process whereby per capita income of a country increases over a long period of time.” Here the word “process” indicates long period changes related to changes in demand side as well as changes in factor supply.
On the other hand, changes arising on the factor supply are also related to—capital accumulation, discovery of new resources, introduction of new and more efficient production techniques, increase in size of population and organisational changes.
Cause and consequences of economic development are mostly determined by the time path and velocity of these aforesaid changes.
Similarly, Britain has developed its industrial sector by importing some minerals and raw materials from abroad.
However, an economy having deficiency in natural resources is forced to depend on foreign country for the supply of minerals and other raw materials in order to run its industry.
Hicks opined, “Economic Development deals with the problem of underdeveloped countries whereas ‘Economic Growth’ deals with the problem of developed countries.
Changes arising on the demand side are mostly related to consumers, tastes and preferences, distribution of income, size and composition of country’s population, and other organisational and institutional changes.
Economic development, being a dynamic concept refers to the continuous increase in production over the changing time path.
Secondly, attainment of economic development indicates increase in real per capita income over time.
Firstly, population provides labour and entrepreneurship as an important factor service.
Natural resources of the country can be properly exploited with manpower resources.