Economists generally agree that four factors—human resources, physical capital, natural resources, and technology—have an impact on economic development and growth. Governments in highly developed countries give these issues top priority. Even in those with a wealth of natural resources, less developed nations will lag if they don't fund technological research and improve the education and skill of their labor force.
The Impact of Human Resources:
Image Source: Ipcentre.com
Qualifications, education, and training of the labor force have a direct impact on the growth of an economy. A labor shortage might impede economic growth. An economy will suffer from having a poorly utilized, illiterate, and unskilled labor force, which may lead to higher unemployment.
Investment in Physical Capital:
Image Source: media.geeksforgeeks.org:
Reduced costs and increased efficiency of economic output will result from improvements and increased investment in physical capital, such as factories, machinery, and roads. Physical labor is less productive than factories and machinery that are modern and well-maintained. Increased output results from higher productivity. As the ratio of capital expenditures per worker rises, labour productivity rises. The economy grows more quickly when labour productivity is improved.
Quantity and Availability of Natural Resources:
Image source: researchgate.ne
The quantity and accessibility of natural resources have an impact on economic growth. The economy will benefit from the discovery of more natural resources by increasing a nation's capacity for production, such as mineral or oil deposits. The ability of a county to use and exploit its natural resources depends on the type of technology used, the skill level of the labor force, and the availability of capital. These natural resources can be used by educated and skilled workers to boost economic expansion.
Improvements in Technology: