What is the difference between short-run and long-run economic growth?

Short-run growth is simply an increase in a country's 'gross domestic product' or 'GDP', whereas long-run growth is an increase in the country's productive capacity. When thinking in terms of an AD-AS diagram, short run growth may be shown by an outward shift in aggregate demand which leads to an increase a long the "GDP" axis. Long run growth may be shown by an outward shift in AS, as this shows an increase in the country's productive capacity.

CH
Answered by Chet H. Economics tutor

16759 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

Evaluate measures that could be pursued by individual firms and by the government to reduce a current account deficit (30)


Evaluate the microeconomic impacts of a sugar tax


Explain the difference between short term growth and long term growth


Could you explain the distribution of the incidence of a tax and why it may fall differently on consumers and producers?


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2025 by IXL Learning