Transcript The causes of the *development gap*

Topic 5 – BRIDGING THE
DEVELOPMENT GAP
The causes of the ‘development
gap’
 Understanding the development and the development gap
Considering different measures of development
Explain and contrast the different views of development
Graph and analyse different development indicators to identify global
variations
How is this unit examined?
2 ½ hour written exam, including pre-released
synoptic resources (8 weeks in advance)
Part 1 – 5 out of 6 topics
Part 2 – 6th topic in a synoptic context (will pull
together aspects of the other 5 topics)
30% of A level
Starter
Discuss with the person sitting next to you:
• What is the development gap?
• How do we measure development?
Development
What is the development gap?
The social and economic difference or disparity
between the wealthy and the poor both globally,
between nations, and within countries (within
cities or local regions)
What is it measured by?
GNP
HDI – Human development Index 0-1,
1 being best – uses income per capita, adult literacy,
life expectancy.
And many other development indicators
Views on development
The Rostow Model
• A study of 15
countries mainly in
Europe suggested
that all countries
had the potential to
break the cycle of
poverty and develop
through 5 stages
 Stage 1 – Traditional Society
Subsistence economy based on farming with limited
technology or capital to develop
 Stage 2 – Preconditions to take-off
Often an injection of external help – industries develop
and growth of infrastructure. Often single industry
will dominate
 Stage 3 – Take off
Manufacturing industries grow, airports and roads are
built. Political and social changes. Farming will
decline. Investment or borrowing increases
2
3
4
5
UK
1750
1820
1850
1940
USA
1800
1850
1920
1930
Japan
1880
1900
1930
1950
India
1950
1980
-
-
-
-
-
-
 Stage 4 – Drive to maturity
Ethiopia
Growth should be self-sustaining. Often multiplier
effects in similar industry types. Rapid urbanisation
 Stage 5 – High mass consumption
Rapid expansion of tertiary services, employment in
service industries grow but decline in manufacturing
Is this model valid?
• Model assumes that all countries start off at the
same level
• Although capital is needed to advance from a
traditional society it often brings debt
repayments which stop a country developing
• Underestimates the extent and impact of
colonialism
• Predicts too short a timescale between the
beginning of growth and becoming self-sustaining
Views on development
Friedmann’s Core and Periphery Model
• Shows how some
areas become more
economically
developed than
others and why
some regions are
more wealthier than
others
Stages
 Stage 1 (Pre-industrial). The agricultural society, with localized
economies and a small scale settlement structure. Fairly isolated,
dispersed and low mobility.
 Stage 2 (Transitional). The concentration of the economy in the
core begins due to capital and industrial growth. Trade and mobility
increase
 Stage 3 (Industrial). Due to economic growth other growth centres
appear. The main reasons for this are increasing production costs
(mainly labour and land) in the core area.
 Stage 4 (Post-industrial). The urban system becomes fully
integrated and inequalities are reduced significantly.
Views on Development
The Development Cable
• Development is like an electric
cable – the power to drive
countries from primitive to more
advanced states.
• As the development cable model
(right) shows, development is a
multi-faceted process
• At its core is economic
development, but to achieve real
progress social, political,
environmental and personal
development is also needed.
Views on Development
The Development Pathway
• Development can
also be seen as a
pathway.
• Countries develop
at different speeds
and may cluster at
different places
• What could hinder
development?
How do we measure development?
1)
Economic Wealth
Measured as Gross Domestic Product (GDP) per capita = dividing the monetary value of all
the goods and services provided in a country by its total population
Gross National Income (GNI) – includes income from overseas investments
GDP – preferred by the EU
GNI by the UN and USA
X
Only useful in countries which have many economic transactions i.e. ‘market
economies’ rather than the non-money economy e.g. barter and exchange
X
Hides extremes and uneven distribution of income between regions or socio-economic
groupings
X
Not reflective of the local value of money
2) Purchasing Power Parity (PPI) GDP
Shows what per capita income will purchase when the cost of living is taken into account.
E.g. In China the cost of living is low so $100 will buy far more there than in the USA
This basket of goods costs 112 Indian
Rupees in India, the equivalent of
£1.50*. To buy the same basket of
goods in the UK would cost around £6.
The difference in how much goods
and services really cost, is why PPP
(purchasing power parity) GDP
income is used rather than ‘raw’ GDP.
Using raw GDP per capita average
income in India is about $1000, but
PPP GDP per capita income is $2800
*data for Dec 2009
Burgernomics
• THE ECONOMIST's Big Mac
index is based on the
theory of purchasingpower parity: in the long
run, exchange rates should
adjust to equal the price of
a basket of goods and
services in different
countries. This particular
basket holds a McDonald's
Big Mac, whose price
around the world we
compared with its
American average of $4.20.
North South Divide
Brandt Commission in 1981
Other criteria
2) Social, cultural and welfare criteria
• Recognising the complex nature of development is why
development is often measured using an index, which combines a
range of data
• Indices are considered more accurate than single data points such
as GDP per capita.
Human Development Index (HDI) gives a country a score between 0
and 1
The Human Development Index (HDI)
Life expectancy at birth + Literacy rate + Enrolment rate + GDP
per capita PPP

X
Enables anomalies to be spotted and identifies where poverty is
greatest
No measure of human rights or freedom. There was a separate
Human Freedom Index in 1991 but has not been done since.
•
•
•
•
•
The
development gap
The geography of the development gap is more complex than a simple ‘NorthSouth divide’
Latin America has HDI levels similar to eastern Europe; China’s HDI and some
others in SE Asia are relatively high
South Asia has a concentration of levels below 0.6
Level in the Middle East are relatively high, although not in Yemen, Syria and Iraq
The picture for Africa is very complex, with the extreme north and south having
decent HDI levels, but some regions with shockingly low numbers
Other Development Indicators?
Infant mortality
The number of children who die before they are five out of every 100 born.
Life expectancy
The average age people can expect to live to
World Freedom Statistics
This is an index which takes into account a range of measures to determine how free people are in a particular
country. The index is complex but takes into levels of political and civil liberties, levels of corruption, and
levels of political and religious conflict. It generates an index score from 1 (free) through to 7 (not free).
% GDP from Agriculture
The % of total GDP (the value of everything sold and made in a country) that comes from farming.
% GDP from Secondary Sector
The % of total GDP (the value of everything sold and made in a country) that comes from manufacturing and
secondary industry.
Population
The total number of people living in a country.
% Population growth
The % change (up or down) in a country’s population – measured annually (every year).
% of population living on less than $1 a day
% of population living on less than $2 day
What is this map showing?
Life expectancy
Infant mortality
Under-nourishment
Oxford p183
• Over to you qs
• On your own qs
Plenary
Why is it hard to measure the development
gap?
Is the Brandt Line still valid?
Explaining development
Do you remember the food crisis of 2008?
Explaining development
Do you remember the food crisis of 2008?
This is probably because you were wellsheltered from the worst because we live in a
developed country.
P179 Oxford
Global food crisis
• Which of the following are real causes for the
rise in food prices since 2006:
Growth of biofuels
Rising demand in NICs
Climate change
Rising demand for cattle feed
Traders hoarding food
Diseases wiping out crops
Rising oil prices
Change in agricultural policies
Extreme weather
Globalisation
Global food crisis
Which of the following are real
causes for the rise in food prices
since 2006:
Growth of biofuels
Rising demand in NICs
Rising demand for cattle feed
Traders hoarding food
Rising oil prices
Extreme weather
Change in agricultural policies
The food price crisis shows how susceptible lessdeveloped countries are to price rises.
1. What happened to food prices in 2008?
2. Why was this?
3. Using the Philippines as an example, explain how a
development gap was shown by the way in which the food
crisis affected its people.
4. What is the development gap?
HW Reading Oxford 178-183
• Note taking