Energy and economic growth are closely related, with energy allowing for more efficient production and technological development. The Industrial Revolution and the discovery of oil helped economies expand rapidly. Efficient production and new technology also drive innovation and market dominance.
Economic growth occurs when a nation allows its citizens to engage in activities that increase the livelihood of all citizens. Energy and economic growth are two items in an economy that have a symbiotic relationship. Without energy, economic growth can falter; This is why the Industrial Revolution played such an important role in history. Energy encourages economic growth as it allows for more efficient production and increases in technological development, both of which lead to better production. In short, economic and energy growth allows companies to cover a market with goods that can ultimately grow an economy from the inside out.
Wind and solar energy were the dominant energy sources in the 13th century. Those living in these eras struggled to produce goods on a large scale that would benefit many individuals. In short, goods produced from energy and economic growth were heavily localized in the immediate market. Until the Industrial Revolution and the discovery of oil as a new source of energy, many economies expanded and grew rapidly. The continued use of oil and other natural energy sources – such as natural gas or propane – has helped economic growth blanket the world.
Efficient production occurs when a company or individual can use resources without increasing waste. For example, a company needs six trees to create three country-style curiosities. New power sources, however, allow the company to use six trees to create five country-style curiosities, due to better use of materials and added machinery. Therefore, economic and energy growth go hand in hand, as new ways of producing the same goods result in a more efficient use of materials on the market. Machines that require power often need enough power from external sources to use resources efficiently.
Technology is often the result of new prospects for economic and energy growth. This principle emerged during the Industrial Revolution. Machines soon replaced manual labor, horses and other manual processes. The economies in today’s market are very similar in this regard. New technology – in terms of computers and other digital equipment – allows companies to expand at an accelerated rate. Individuals often benefit from companies due to economic and energy growth.
Finding new ways to increase production is often a goal for companies. The ability to do things in new ways is what drives innovation. Without energy and economic growth, an economy can quickly become stagnant and suffer losses. Therefore, economies with insufficient energy sources are often those that struggle to maintain market dominance.
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