What are key structural changes brought in an economy by Economic Development?

Following changes can be seen in an economy with economic development.

Constituents of GDP Change

With economic development, savings rate increase, government revenues increase, the share of income spent on food items decrease and on industrial goods and services increase.

Employment Changes

The labour force starts to shift from primary sector to secondary and territory gradually.

Shift in Composition of Exports

With development, a country starts to export more of manufactured goods and the share of primary goods decreases in exports.

Rate of Increase in Population

With development, in initial phases, population rises but gradually it starts falling due to change in social attitudes.

Distribution of Income

Inverted-U shaped curve given by Simon Kuznets claims that initially income inequalities increase with increase in per capita income and start to fall after a certain level.