Inclusive Growth

Inclusive growth is a concept which advances equitable opportunities for economic participants during the process of economic growth with benefits incurred by every section of society.

The definition of inclusive growth implies direct links between the macroeconomic and micro-economic determinants of the economy and economic growth. The micro-economic dimension captures the importance of structural transformation for economic diversification and competition, while the macro dimension refers to changes in economic aggregates such as the country’s gross national product (GNP) or gross domestic product (GDP), total factor productivity, and aggregate factor inputs.

Sustainable economic growth requires inclusive growth. Maintaining this is sometimes difficult because economic growth may give rise to negative externalities, such as a rise in corruption, which is a major problem in developing nations. Nonetheless, an emphasis on inclusiveness - especially, on equality of opportunity in terms of access to markets, resources, and unbiased regulatory environment for businesses and individuals - is an essential ingredient of successful growth strategies. The inclusive growth approach takes a longer-term perspective, as the focus is on productive employment as a means of increasing the incomes of poor and excluded groups and raising their standards of living.