How Savings and Investment Is Effecting the Economic Growth

How Savings and Investment Is Effecting the Economic Growth

Author – Payal(payalraghav705@gmail.com)

Co-author

Sourabh(pilaniasourabh666@gmail.com)

Co- author

Saudamini(saudamini2004@gmail.com)

Abstract :-

Savings and investments are fundamental components influencing Economic growth, particularly in developing countries.

 Higher savings rates encourage more investment, which is essential for boosting economic productivity and expanding production capacities. As savings increase, , so  do investments, which subsequently Contribute to higher GDP growth rates.  This research paper explores the relationship between savings , investments and economic growth, emphasizing their crucial roles in  Sustainable development.  Savings serves as  fundamental source of capital, enabling investment that drive productivity and innovation.  The paper examines how higher savings rates lead to increased domestic investments, which motivate economic expansion and enhance overall GDP growth The research investigates the impact of government policies promoting savings and investments, savings provides vital source of financial capital, which is essential for funding investment in  infrastructure , funding investments in innovation, technology .  Government can  foster economic growth by implementing policies that encourage savings, such as financial Education programs and incentives for Savings.  Savings and investment are key determinants of economic growth ,as they influence capital formation ,productivity, and overall development .  By analysing various economic models and case studies from different economies, we  explore how higher savings rates and investment levels contribute to GDP growth.  This finding suggest that while savings provide the capital for investment , it is efficient allocation of these investments that drives sustainable economic development

Key words:   Savings, investing, economic expansion, and sustainable development