Economic growth refers to an increase in the production of goods and services over time, often measured by rises in real GDP. Key causes of economic growth include enhancements in the quantity and quality of factors of production, alongside innovation and market expansion. These factors are essential for A-level Economics students to understand when analyzing long-term economic performance.

• Increase in the workforce: A larger number of workers expands the labor supply, boosting overall productivity and output.
• Improvement in worker quality: Enhancements in skills through higher education, vocational training, or health improvements lead to more efficient labor.
• Greater investment in research and development (R&D): Commitment to R&D fosters innovation, creating new products and processes that drive growth.
• Technological advancements: Improvements in technology increase efficiency and allow for higher production levels with the same inputs.
• Investment in capital stock: Building infrastructure, machinery, and equipment raises the capital available for production.
• Increased mobility and flexibility of factors: Easier movement of labor and capital between sectors reduces inefficiencies and promotes optimal resource allocation.
• Expansion into new export markets: Accessing international markets increases demand for domestic goods, stimulating production and economies of scale.