Economic growth is an increase in the production of goods and services in an economy over a period of time. An increase in economic growth corresponds to an increase in the value of goods and services produced. This increase in value is generally measured in terms of Gross Domestic Product (GDP).

The four key phases of economic growth, as defined by economists, are expansion, peak, contraction and trough. Expansion is when an economy increases production and consumption of goods and services. This period of increased economic activity is commonly referred to as an ‘economic boom’ or ‘upturn’. A peak occurs when an economy reaches its highest point of economic growth, when economic growth is most vigorous. A contraction occurs when economic output decreases and economic growth slows. Finally, a trough is the lowest point of economic activity, indicating a recession or ‘economic downturn’.

Increases in capital goods, labor force, technology and human capital can all contribute to economic growth. Capital goods are tangible items used in the production of other goods, such as factories, machines, and tools. An increase in labor force refers to an increase in the number of employed people in an economy, while an increase in technology refers to the development of new, more effective productive methods. Human capital refers to the skills and education of people in an economy, which can help increase the efficiency of production.

Tax cuts and increases in government spending are two key measures for spurring economic growth. In general, increases in government spending tend to be more effective at spurring economic growth than tax cuts. Increases in government spending on infrastructure and public services, for example, can help to create jobs, increase consumption, and stimulate private investment.

However, if the rewards of economic growth are only enjoyed by an elite group of people or corporations, then it is unlikely that this growth will be sustainable in the long term. Sustainable economic growth is characterized by broader economic gains and improved living standards, not just rising inequalities between certain individuals or groups.