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Economic Development

National and subnational governments around the world want to reactivate or accelerate growth through the combination of policies and economic development strategies. In addition, most leaders see the well-being of citizens, not just income growth, as the main goal to pursue. In support of that pursuit, governments need a sustainable, comprehensive approach to economic development.

The dual pursuit of economic growth (and variations on that goal that emphasize employment or other related aspects) and improvements in well-being is a matter of importance and urgency. Many countries are still recovering from the global economic crises, and many are increasingly concerned about inequality (the lack of social inclusion) and environmental damage.

There are two ways to address these concerns: BCG's economic assessment and BCG's approach to economic development.

Sustainable Economic Development Assessment (SEDA)

BCG’s SEDA provides a definition of well-being based on three fundamental elements, which themselves are comprised of ten dimensions that are used to create a relative fact-based measure of well-being across countries.

The first element is economics, which includes income, economic stability, and employment dimensions. The second element, investments, encompasses education, health, and infrastructure, which account for much of government budgets. The third element covers two aspects of sustainability: social inclusion—including income equality, civil society, and governance—and environment.

SEDA provides four measures that deliver different insights into each country's relative level of well-being:

  • Current Level. A snapshot of well-being at the country level
  • Recent Progress. How well-being has evolved over the last seven years
  • Wealth to Well-Being. A country's well-being compared to what would be expected given its per capita income level
  • Growth to Well-Being. Whether a country has converted its economic growth into well-being improvements at a rate higher or lower than that expected on the basis of global averages

This information can help leaders and policymakers identify priorities and create effective strategies that can improve well-being over time.

Approach to Economic Development

BCG's approach to economic development is designed to guide national and subnational governments as they craft and implement strategies aimed at fostering growth, promoting employment, and paving the way for improvements in well-being. The approach consists of three components:

  1. A set of key principles that contribute to economic development that paves the way for improvements in well-being
  2. A framework that allows governments to match their goals and priorities—some of which stem from the SEDA diagnostic—with targeted strategies that build on a sound macroeconomic and institutional foundation or are executed in parallel with efforts to strengthen that underlying foundation
  3. A toolkit consisting of tactics and concrete actions that have been shown to be successfully employed as part of development efforts around the world

Discover How BCG Approaches Economic Development

Public Sector
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