Chapter 10

DEVELOPMENT

Key Question:

HOW DO YOU DEFINE AND MEASURE DEVELOPMENT?

What does Development Mean?

  The process of improving the material conditions of people through the diffusion of knowledge and technology More developed countries (MDCs)  Formerly “1 st world” countries  Lesser developed countries (LDCs)  Formerly “3 rd world” countries

Where are MDCs and LDCs Distributed?

 More developed regions  North America and Europe  Other MDCs with high HDI = Russia, Japan, Australia, and New Zealand  Less developed regions  Latin America = highest HDI among LDCs  Southwest Asia, Southeast Asia, Central Asia = similar HDI  South Asia and sub-Saharan Africa = low levels of development

What does Development Mean?

 Development implies “progress”    Progress in what?

Do all cultures view development the same way?

Do all cultures “value” the same kinds of development?

Development Models

Modernization Model Walt Rostow’s model assumes all countries follow a similar path to development or modernization, advancing through five stages of development, climbing a ladder of development.

- traditional - preconditions of takeoff - takeoff - drive to maturity - high mass consumption

Rostow’s Ladder of Development

Measuring Development

Gross National Product (GNP) Measure of the total value of the officially recorded goods and services produced by the citizens and corporations of a country in a given year. Includes things produced inside and outside a country’s territory.

Gross Domestic Product (GDP) Measure of the total value of the officially recorded goods and services produced by the citizens and corporations of a country in a given year. Gross National Income (GNI) Measure of the monetary worth of what is produced within a country plus income received from investments outside the country. ** Most common measurement used today.

Issues with Measuring Economic Development  All measurements count the:  Formal Economy – the legal economy that governments tax and monitor.

 All measurements do not count the:  Informal Economy – the illegal or uncounted economy that governments do not tax or keep track of.

Other Ways of Measuring Development     Occupational Structure of the Labor Force Productivity per Worker Transportation and Communications Facilities per Person Dependency Ratio

Dependency Ratio by Country, 2005 A measure of the number of people under the age of 15 and over the age of 65 that depends on each working-age adult.

Why Does Development Vary Btwn Countries?

 Economic indicators of development  The Human Development Index (HDI)  Four factors used to assess a country ’ s level of development:  Economic = (1) gross domestic product (GDP) per capita  Social = (2) literacy and (3) amount of education  Demographic = (4) life expectancy

Human Development Index

Why Does Development Vary Btwn Countries?

 Economic indicators of development  Types of jobs  Primary sector – directly extract materials from earth  Secondary sector – manufacturing of products  Tertiary sector – provision of goods and services  Productivity  Measured by the value added per capita  MDCs are more productive than LDCs  Consumer goods

Motor Vehicles per 1000 ppl

Why Does Development Vary Btwn Countries?

 Social indicators of development  Education and literacy  The literacy rate  Health and welfare  Diet (adequate calories)  Access to health care

Students Per Teacher, Primary School

Figure 9-6

Differences in Communications Connectivity Around the World

Why Does Development Vary Among Countries?

 Demographic indicators of development  Life expectancy  Babies born today in MDCs have a life expectancy in the 70s; babies born in LDCs, in the 60s  Other demographic indicators:  Infant mortality  Natural increase  Crude birth rate

Where Does Level of Development Vary by Gender?

 Gender-Related Development Index (GDI)  Compares the level of women ’ s development with that of both sexes    Four measures (similar to HDI):  Per capita female incomes as a percentage of male per capita incomes  Number of females enrolled in school compared to the number of males Percent of literate females to literate males Life expectancy of females to males

Gender-Related Development Index (GDI) Figure 9-17

Demographic Indicator of Gender Difference: Life Expectancy Figure 9-21

Where Does Level of Development Vary by Gender?

 Gender Empowerment Measure (GEM)  Compares the decision-making capabilities of men and women in politics and economics     Uses economic and political indicators:  Per capita female incomes as a percentage of male per capita incomes Percentage of technical and professional jobs held by women Percentage of administrative jobs held by women Percentage of women holding national office

Gender Empowerment Measure (GEM)

Figure 9-22

Economic Indicator of Empowerment: Professionals Figure 9-23

Progress Toward Development

Figure 9-26

Why Do LDCs Face Obstacles to Development?

 Development through self-sufficiency  Characteristics:  Pace of development = modest  Distribution of development = even  Barriers are established to protect local business  Three most common barriers = (1) tariffs, (2) quotas, and (3) restricting the number of importers  Two major problems with this approach:  Inefficient businesses are protected  A large bureaucracy is developed

Why Do LDCs Face Obstacles to Development?

 Development through international trade  Rostow ’ s model of development    Examples of international trade approach The “ four Asian dragons ” Petroleum-rich Arabian Peninsula states  Three major problems:  Uneven resource distribution  Increased dependence on MDCs  Market decline