Economic Growth and Sustainable Development: Italy vs. Tanzania

This report provides a comparative analysis of economic growth and sustainable development in Italy and Tanzania from 1995 to 2017. The study focuses on GDP per capita PPP as a key indicator of living standards and economic progress, exploring the impact of various economic theories, including the Solow growth model and the Malthusian model of population. The report examines the effects of technology and government intervention on resource utilization and economic development. It analyzes health and education expenditures in both countries, highlighting the contrasting trends in expenditure patterns and their implications for human resource development and economic growth. Policy recommendations emphasize the importance of education, resource management, and increased investment in health to foster sustainable economic development. The analysis draws upon data from the World Bank and incorporates insights from relevant academic literature, offering a comprehensive understanding of the economic trajectories of Italy and Tanzania.

ECONOMIC GROWTH AND
SUSTAINABLE DEVELOPMENT

INTRODUCTION
• Economic development is one of the important factor for each and
every country as the developing nations will be able to channelize
their internal resources
• For the purpose of analysis, two countries has been chosen. One of
the rich country is Italy and another poorest country is Tanzania.
• The time period has been chosen is from 1995-2017 and during this
time period, the growth rate of Italian economy is showing an
upward movement in the growth rate and the gdp per capita of
Tanzania is showing more or less constant growth.
Figure 1: GDP per capita PPP
Source: GDP per capita, PPP (current international $, 2019)

CONTD…
• In order to bring sustainability within the economy, growth of GDP is
important and the study is focussing on the GDP growth per capita PPP.
• This variable will identify the purchasing power of the individual living
in these two countries and how the gdp is having impact on increasing
the standard of living.
• The study will identify the consequences and effects of various theories
in the form of Solow growth model, Malthusian model of population and
the factors that are helping in improving the quality of labour.

Contd..
• Technology will be playing an important factors that will
determine the growth of economy and using this poorer
economies will increase their growth.
• In spite of high growth in technology, the strong government
intervention is required in order to increase the proper
utilisation of resources.
• The main aim of this study is to bring the consequences of
economic growth that will increase the development of
economy.

THEORY
• The growth of the population is maintained by the constant growth of g.
Current population is N and future population is N’ and the rate of
n’=n(1+g).
• Consumers within the economy saves a certain amount s of their income
and consume c of their income y. C= (1+s) Y or s= (C-Y)/Y and that is
the growth of capital.
• The production function that will be used by Italy and Tanzania is y=a
f(k,l) where k =capital and l= labour

CONTD..
• According to the theory proposed by Malthus, the population grows in
GP and the food production grows at AP.
• Technology is going to have direct impact on the economic development
as it indulges development in human resources (henderson & loreau,
2019).
• Government intervention is going to increase the ways of resources
development and is going to increase development of economy.

APPLICATION
• Taking into account the health expenditure it has been seen that
being one of developed nations, the Italian economy is having
high expenditure on the health sectors that is falling deep and
Tanzania is having constant rate of expenditure
• Italian economy is going to increase the expenditure on health as
the number of aged persons are increasing in Italian economy.
• Economy of Tanzania is having constant or zero level of
expenditure on health sectors
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Health Expenditure
Health Expenditure Italy Health Expenditure Tanjania
year
Percentage

CONTD..
• Tanzania is not increasing their expenditure on health sectors
rather than they are trapped in GDP circles
• Tanzania is going to increase the development of resources and
will automatically allow economy to grow and indulge the
development of human resources.
• Through the improvement in the health expenditure healthy human
resources is going to increase the improvement in the economy.

EXPENDITURE ON EDUCATION
• Education expenditure is going to show an important sense that
through the development of the expenditure will improve the
production ability of the human resources.
• Through the development of economic expenditure on education will
increase the development of production ability of human resources.
• Educational expenditure is going increase the development process
that will not only increase the development of resources but will
indulge the development of process.

POLICY
RECOMMENDATION
• It is important in the sense that in order to increase the economy growth,
education is important.
• It is important for the development of economic growth the development
in the resources will be highlighting the development of resources.
• The government need to increase their monitoring power that will
increase resources channelization.

CONTD..
• Increase in resources utilisation will automatically indulge the economy to
grow and develop.
• Increasing the expenditure in health is going to increase the potentiality of
human resources.
• Increasing expenditure on knowledge is going to improve resources
development that will not only increase the spending but will also allow the
growth of economy.

REFERENCE LIST
• Current health expenditure per capita, PPP (current international $) | data. (2019).
Data.Worldbank.Org. Retrieved 15 may 2019, from
https://data.Worldbank.Org/indicator/SH.Xpd.Chex.Pp.Cd?End=2018&locations=au-cd&start=1995
• GDP per capita, PPP (current international $) | data. (2019). Data.Worldbank.Org. Retrieved 15 may
2019, from https://data.Worldbank.Org/indicator/NY.Gdp.Pcap.Pp.Cd?End=2017&locations=au-
cd&start=1995
• Henderson, K., & Loreau, M. (2019). An ecological theory of changing human population dynamics.
People and nature.
• Kaddar, a., Sahbani, S., & Alaoui, H. T. (2017). Hopf bifurcation in a delayed solow-verhulst model.
Research in applied mathematics, 1.
•