Syllabus: Pearson - AS Level Economics
Module: 2.1 Measures of Economic Performance
Lesson: 2.1.1 Economic Growth

Introduction

This article supports the Pearson Edexcel AS Level Economics A specification, specifically Topic 2.1.1 on Economic Growth. Part of the broader “Measures of Economic Performance” theme, this unit introduces students to one of the most headline-grabbing indicators of economic health.

Economic growth isn’t just a macroeconomic buzzword. It’s about what drives living standards, tax revenues, public spending, and opportunities — all things your students can connect with, especially when grounded in current events. This content lays the foundation for understanding GDP, real vs nominal figures, and the broader implications for policy and prosperity.

Key Concepts

In line with the Pearson Edexcel AS Level Economics A specification, students are expected to understand:

• Definition of economic growth: An increase in real GDP over time.

• Real vs nominal GDP: Understanding the importance of adjusting for inflation to make meaningful comparisons.

• Total and per capita growth: Recognising that GDP per capita offers a clearer picture of living standards.

• Short-run vs long-run growth: Distinguishing between temporary boosts (e.g. post-pandemic rebounds) and structural improvements (e.g. better infrastructure or productivity).

• Determinants of growth: These include investment, technological progress, education, infrastructure, and political stability.

• Constraints on growth: Such as poor governance, inflation, inadequate capital, and global supply shocks.

• Benefits of growth: Higher incomes, increased employment, and improved public services.

• Costs of growth: Inequality, environmental degradation, and inflationary pressures.

Real-World Relevance

Economic growth is in the news almost weekly. You might want to bring in:

• UK economic data from the ONS: Let students interpret quarterly GDP changes and what’s driving them (e.g. services vs manufacturing).

• Post-COVID recovery scenarios: How different countries bounced back — or didn’t.

• China’s slowing growth: Despite being an emerging superpower, structural issues have tempered its growth rates.

• Green growth vs traditional growth: Invite students to explore how sustainability policies (e.g. the UK’s Net Zero targets) might redefine how we think about ‘good’ growth.

Real-world mini case studies:

• India’s investment in digital infrastructure led to faster inclusion in financial services and education.

• Germany’s industrial slowdown due to energy price shocks gives a live example of how external constraints affect output.

How It’s Assessed

In AS assessments (Paper 2 – The UK Economy – Performance and Policies), students will encounter:

• Data-response questions using GDP statistics or economic growth commentary.

• Short-answer and extended-response tasks that test understanding of causes, consequences, and policy responses to growth.

• Command words to prepare for:

  • Explain: “Explain how GDP per capita might rise even if GDP remains constant.”

  • Analyse: “Analyse how an increase in investment could lead to economic growth.”

  • Evaluate: “Evaluate the consequences of sustained economic growth for the environment.”

Diagrams (like PPCs or AD/AS models) should be clear, labelled, and interpreted — not just drawn.

Enterprise Skills Integration

This topic offers a natural space to build:

• Analytical skills: Students can compare economic performance across time or countries using data sets.

• Decision-making: Through debates on whether to prioritise growth or sustainability.

• Problem-solving: Scenario-based activities asking students to propose solutions to low growth, considering trade-offs.

• Numeracy: Calculating percentage change in GDP, growth per capita, and interpreting trends.

Activities such as “UK Chancellor for a Day” simulations can let students weigh up competing policy priorities using real data.

Careers Links

Understanding economic growth opens up a wide array of real-world applications aligned to Gatsby Benchmarks:

• Careers in public policy, government, finance, and international development often centre around how economies grow and distribute resources.

• Economist, data analyst, investment strategist, and policy advisor roles directly use these skills.

• Link growth concepts to Gatsby Benchmark 4 (linking curriculum learning to careers) by inviting speakers from local business networks or think tanks.

Highlight how knowledge of GDP and growth is central to roles in both the public and private sectors, particularly when assessing impact and value for money.

Teaching Notes

Top tips:

• Anchor abstract theory in concrete examples. Bring in newspaper cuttings, ONS graphs, or IMF forecasts.

• Differentiate using per capita vs total growth. It’s a common source of misunderstanding.

• Use diagrams actively. Get students to annotate changes on AD/AS curves or PPCs, not just draw them.

• Link to student experience. Ask how growth might affect their local community — more jobs, new services, higher rents?

Common pitfalls:

• Confusing real with nominal GDP.

• Treating growth as always “good” without discussing costs.

• Forgetting the time dimension — growth over a quarter vs a decade matters.

Extension activities:

• Debate: “Growth at any cost?”

• Research task: Compare GDP growth trends for three countries over 10 years.

• Model UN activity: Students represent different countries pitching their strategies for inclusive growth.