Economics Growth and Business Development: The views from the historical perspective and important aspects in contemporary context

 Economics Growth and Business Development: The views from the historical perspective and important aspects in contemporary context

Regular and sustainable economic growth and advancement of businesses have been the key facilitating factors for the development of the world for centuries. Knowledge of their development process and functioning today gives a chance to understand how societies can contribute to the formation of sustainable development in the future. This blog goes straight into the origin of economic growth and business advancement and learning the journey from the historical past to the present by learning from existing businesses and advancing the future of business in relation to a growing economy.

Historical Context: The shift of the economy from being mainly agricultural to one being industrial.

     The Agricultural Revolution

The economic development in its broadest sense could be traced back to the Agricultural Revolution which occurred 10 000 BCE. This period saw the developments of sedentary people from farmers, and hunters and gatherers. And when human beings transited in search of food by practicing agriculture results in production hence developing the areas of markets and trades. The yield that was in excess of the requirement for consumption needed for today and tomorrow was needed in order to have specialization of working tasks which in turn is a very early but significant sign of economic development.

       Commerce and Trade: The Next Phase

During the mid – late middle ages, there were more routes of trade across Europeans Asia and Africa. For example, the widely popularised route, the Silk Road was a trade corridor that linked the world’s civilisation starting from the Orient and going up to the Occident and was used to transfer movable properties but not just the recognised products, ideas and technology included. This period also brought the merchant classes and the banking and a stock exchange in the cities of Venice and Amsterdam. The continual raise in trade and commerce established the foundation for the more radical changes of the future.

The Industrial Revolution

Since late eighteen century the occurrence of industrial revolution was introducing a new era in economical history. Inventions in St. were steam engine which was earlier used in coal mines and later in railways while mechanization of textile cloth and iron and steel all these inventions revolutionalised industries. During this period there was technological development from an agricultural based economy to an industrial city, the productivity and the economy.

The Industrial Revolution also viewed as the period of serious changes in the business world. It becomes easier to understand why new types of organization and management emerged in connection with factories and industry. No less important were inventions and innovations by coopers such as Richard Arkwright and James Watt who not only developed new technologies of power but also put into practice different patterns of manufacturing and selling, corresponding to the formation of a modem business corporation.

      Some Important Factors of Economic Growth

     Classical Economics

The classical economists were Adam Smith, David Ricardo and Thomas Robert Malthus played a very important role in framing the basic structure of Economic growth. Smith coined what he known as the particular invisible hand theme and argued it in the form of proposition that announced: The society made better by selfish people who gave the right quantities of resources. Comparing Ricardo’s subjective geared towards proving that all parties benefited from trade to what Malthus offered on views of population that suggested growth would be limited by scarcity of resources.

      Neoclassical Growth Models

In the century neoclassical growth models particularly Solow – Swan model differentiated between capital deepening, labour and technology. These models added the so-called declining rate of return to capital; it can only increase persistently if the technological frontier advances. This also caused new emphasis in these models on such primary factors of production as human capital, including education and skills.

   Endogenous Growth Theory

However, endogenous growth theory that came to light in the nineties with Romer, took a further step in concentrating on internal attributes of an economy that determines growth. According to this theory knowledge, innovation and human capital are seen as key players in the achievement of long run economic growth. It differs from neoclassical models to assert that outlays on research and development, education and other infrastructure are capable of yielding everlasting efficiency gains.

   Modern Business Development: Strategies and Implications

      Innovation and Technology

As mentioned above, in the current dynamically changing economy innovation and technology are critical in building the business. Apple, Google, and Tesla represent that, with an edge technology and creative approaches, it’s possible to achieve a radical advancement. The advent of R &D and innovation or the drive for innovation is therefore an effective business model that any competitive minded organization or individual should embrace with the view of developing a competitive economy.

Technological advancement is has also increased the availability of information and resource all over the world. New knowledge enables small business to go global, take advantage of the new instruments and technologies previously obtainable only to the biggest giants. It can contribute to the appearance of start-ups, as well as the development of many sectors and fields, for this democratization.

     Globalization

Globalization is come across as one of the most influential forces for business development. Global markets integration allows business people to get in contact with bigger markets for consumers, more extensive source of supplies, and a more extensive employee base as well as a bigger potential of funding. However, there is also pressure from global competition as well as the need to address global regulatory systems to undertake business.

In today’s complex market, only those firms that can manage to operate in a more than one context and environment can thrive. They rely on outsourcing sources all over the world while at the same time they are able to adapt to the local customers’ requirements and standards. This agility is very vital in the ability of any country to continue incorporating growth and development as the world becomes one market.

    Sustainable Development

In the last few decades, awareness of the concept of sustainable development or development that empowers the coming generations, today and tomorrow,

The major sigh of concern has shifted towards sustainable development. Some reasons why companies are embracing sustainability are not just moral, but also rational, meaning that sustainability is fast becoming a business policy. 

Responsible business management embraces less emissions, friendly environment, best utilization, and circulation of the available resources. Remarkably, some current leaders such as Patagonia and Unilever have managed to demonstrate that this concept can add value to the fundamental company competencies, engage customers, and generate sustainable revenues over time. Additionally, the sustainable can manage the risks that arised from scarcity of the resource or changes in regulations which make the business\t\tstronger against those environmental challenges.

   

       National and Township Government and Policies

One of the significant functions of governments is to set up the context of economic development and company operation. Proper policies can help develop a right climate for business and also help in achieving wider economic goals and targets. Key areas of government intervention include:

      Infrastructure Development

Having improved transport systems, energy, and communication networks is basic to any emerging economy. Good infrastructure also reduces organisational costs and enhances economic efficiency and commerce and investment. One of the most important trends in the modern economy is the development and implementation of public and private cooperation in financing and construction of large-scale facilities.

     

Investing in education and vocational training would ensure that economy was boosted by governments. Qualified human resource is important for the company so that superior skills can be developed to support new complex initiatives for the sake of gaining competitive edge. Educational stake in STEM, science, technology, and continual learning as well as re-skilling of the workforce helps employees sufficiently meet the new jobs demand.

     Regulatory Environment

The business development requires stability and transparency of the regulating environment. certainty of the legal provisions & the ability to safeguard the rights to property are fundamental in order to provide the much needed encouragement to the business to grow. In the same respect, it is always preferred that the regulations should provide for growth and development aged issues such as privacy of data, cyber security, environmental sustainability among others.

      To be more precise, let’s talk about Innovation and Research Support.

Ways with which governments can stimulate innovation include direct funding of research and development, offering tax incentives to firms and institutions engaging in R&D and technology transfer from universities and other research ecosystems to firms. They also increase technological development and growth by establishing places for innovation production and nurturing, where both businesses, universities, and other research institutions may be accumulated.

 Looking further ahead, global trends and the likely consequences of these developments are significant.

      Digital Transformation

This paper found that the digital transformation is imminent to be an important source of growth and business advancement in the future decades depending. Soft technologies like AI, Blockchain, IoT are already changing industries and bringing newer opportunities. Those industries which might use these technologies to make the operations smooth, invent new products, and develop the customer experiences will be leading in the economic growth.

However it is crucial to point out that with opportunities come new risks including; data security, data privacy, and the digital divide. Making sure that all groups within the society are connected with technology as well as equip to use the technologies is very important for everyone.

                  Green Economy

Another major pattern that characterized transition to green economy as yet another trend of future economical development. In the absence of global policies on climate change, more than ever, the companies that pioneer the technologies for sustainability will keep the world moving in the right direction. This includes generation of electricity by renewable energy sources, using energy friendly products in the market and sustainable farming.

Carbon pricing, subsidies to renewable sources of energy and adequate emission standards key amongst them will play a significant roles in achieving this transition. Those enterprises that actively seek to engage with these policies and bring in environmentally friendly technologies will be granted new outlets for market growth and improve their image on the market.

     Global Economic Shifts

The global economy is ever changing with some older industrialized countries in Europe and America gradually being overtaken by new economies in Asia, Africa and Latin America. Organisations who are able to successfully factor these dynamics and make their first entry into these markets shall have high growth prospects. Market knowledge, referral, and product/service customization are identified as key activities for success.

  
                   Conclusion

Economic growth and business development are complex and ever changing phenomena that have gone through many changes during centuries. Whether it is the post Agricultural Revolution shift to Hunt and Hunt, Industrial Revolution to the current Digital Revolution, the forces of change have continued to evolve with a new wave of changes. Contemporary problems and concerns are innovation, globalization, sustainability, human capital and all of them are at the core of business development.

Companies and governments should establish the conditions for developing innovation, sustainability, and individuals’ capital. It also recognizes the fact that the simplistic notion of markets is no longer a reality while managing the uncertainties that are characteristic of the present day business organization environment, hence the essence of management.