Economic Development In Canada Essay

Normally, the rate of capital formation in underdeveloped countries is very poor.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.If the countries are rich in natural resources and adopted modern technology for its utilization, then they can attain higher level of development at a quicker pace.Mere possession of natural resources cannot work as a determinant of economic development.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. 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. In underdeveloped countries the problems are that of initiating and accelerating development.” According to Maddison, “the raising of income levels is generally called economic growth in rich countries and in poor ones, it is called economic development.” The processes of economic development should not only generate increased or enhanced means of production but it should also make room for equitable distribution of such resources.Moreover, capital formation requires the suitable skill formation so as to utilise physical apparatus or equipment for raising the productivity level.In an economy, capital accumulation can help to attain faster economic development in the following manner: (a) Capital plays a diversified role in raising the volume of national output through changes in the scale or technology of production; (b) Capital accumulation is quite essential to provide necessary tools and inputs for raising the volume of production and also to increase employment opportunities for the growing number of labour force; (c) Increase in capital accumulation at a faster rate results increased supply of tools and machinery per worker.

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