Social scientists commonly propose that a growing economy is an important part in improving people's living standards. An economy that possesses and creates enough goods and services can theoretically fulfill the basic needs of its people, such as food and clothing. Thus, many developing and underdeveloped countries have set up systems of maximizing their potential income in whatever way possible, assuming the profits will eventually reach the masses. The results have been mixed.

A plan of merely developing the economy to generate the highest amount of absolute income and goods can still fail in improving living standards for a greater number of people. Although many countries worldwide have experienced unprecedented economic development since the end of the 20th century, that development has still failed in many cases to greatly improve the lives of lower income people in developing and underdeveloped countries.

In a study documenting economic growth and development against child nutrition standards, Harvard School of Public Health social epidemiologist S.V. Subramanian noted that national economic growth does not always equate to a higher standard of living. Among 36 developing and underdeveloped countries he and his team studied from 1990 to 2011, Subramanian found that despite national gross domestic product and per capita income growth, the positive effects of the growth has been negligible on reducing malnutrition on national levels. An updated UNICEF report documented that as of 2011, more than 25 percent of children worldwide at or below the age of five suffered malnutrition-induced stunted growth, with 16 and 11 percent being underweight or "wasted," respectively. For instance, in Ethiopia, despite a nearly $300 growth in the per capita gross national income to $400 from 2000 to 2011, an excess of five million children still suffered stunted growth in 2011. 

Notably, in many of those countries, even where the national economy is booming and absolute national prosperity is increasing, satisfying basic needs such as food has been problematic. Although the economy may be generating more income and output, this new prosperity often does not reach the poverty-stricken areas and populations of the country because the money is trapped in regions or industries that are already developed and prosperous. 

The economic growth in India demonstrates this paradox. According to Subramanian, tourism fuels a large part of the Indian economy and the sector keeps developing every year. To that end, India has invested heavily in developing infrastructure supporting the tourism sector, such as expansive new roads and modernized airports. But how does a family living in the slums benefit from a five lane highway? 

Sanghamitra Bandyopadhyay of the London School of Economics and Political Science has also said that much of the wealth is concentrated along India's western coastal regions because industry and manufacturing are concentrated there. The more inland northern regions, on the other hand, do not enjoy such high economic activity and remain poor as a result. 

Unfortunately, political corruption can also exacerbate the problem, when corrupt politicians purposely funnel wealth toward already wealthy individuals, population sectors or industries after receiving bribes. According to Oxfam International, a nongovernmental organization dedicated to reducing world poverty, wealth is concentrated among a limited number of individuals in India partly because of corrupt political dealings. The government provides certain business leaders with exclusive access to profitable industries such as mining and telecommunications. These leaders profit, while their employees feel none of the benefits of globalization. It is true that an economy needs to develop revenues and output to benefit the people. However, when development and its outputs are only concentrated and locked within specific economic sectors, they cannot reach the people who need them most. 

A steady and requisite level of income, which many families in the developing world and even in developed countries lack, is necessary for providing basic needs such as food, clothing and shelter. Of course, the governments should also do their part by investing in more public goods and services that would provide much needed long-term benefit to their poor populations. As with India, perhaps the government should invest more national economic output into providing potable drinking water, sanitation services and other social assistance programs.

In a developing country, the economy should be developing for the overarching purpose of ensuring that the country as a whole can enjoy the benefits of prosperity. In countries where people have trouble securing basic needs, a booming economy should first and foremost address those needs so that people can at least stay alive and healthy. Many people may want to participate in the economy, but they cannot due to factors beyond their individual control, such as a lack of jobs and services in their impoverished areas because of developmental disparities. A nation's continuing economic growth and social stability will depend on the well-being of the people. If they cannot secure at least a basic living standard, they will likely be impeded in their future economic contributions.

Developing countries worldwide have lifted themselves from the most extreme levels of poverty by growing their economies. While growing an economy in the absolute sense is necessary for the resources gained to benefit the general population, without distributing those resources to where they are needed most, the real benefits for the people will be limited. Developing an economy is like baking a cake: The baker can make a bigger cake by adding more batter, but if it is not actually shared among the diners, then there might as well be no cake at all. 

There is no magic bullet for economic development, but economic distribution should at least be considered when governments draft their economic plans.
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