Individuals, groups and leaders who promote human development operate under b institutional, structural and political constraints that affect policy options. But experience suggests broad principles for shaping an appropriate agenda for human development. One important finding from several decades of human development experience is that focusing exclusively on economic growth is problematic. While we have good knowledge about how to advance health and education, the causes of growth are much less certain and growth is often elusive. Further, an unbalanced emphasis on growth is often associated with negative environmental consequences and adverse distributional effects. The experience of China, with its impressive growth record, reflects these broader concerns and underlines the importance of balanced approaches that emphasize investments in the non-income aspects of human development.

With reference to the above passage, the following assumptions have been made:

1.Higher economic growth is essential to ensure reduction in economic disparity. 

2.Environmental degradation is sometimes a consequence of economic growth

Which of the above assumption/assumptions?