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Indicators of Economic Development

Indicators of Economic Development. Warm-Up. How do you tell how developed a country is? What are the indicators?. Population Map. Wealth Map. Growth vs. Development. Economic growth may be one aspect of economic development but it is not the same Economic growth:

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Indicators of Economic Development

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  1. Indicators of Economic Development

  2. Warm-Up • How do you tell how developed a country is? • What are the indicators?

  3. Population Map

  4. Wealth Map

  5. Growth vs. Development • Economic growth may be one aspect of economic development but it is not the same • Economic growth: • A measure of the value of output of goods and services within a time period • Economic Development: • A measure of the welfare of humans in a society

  6. Economic Growth • Using measures of economic growth can give distorted pictures of the level of income in a country – the income distribution is not taken into account • A small proportion of the population can own a large amount of the wealth in a country This might be a common picture…… But this could be just around the corner!

  7. Economic Growth • Using measures of economic performance in terms of the value of income, expenditure, and output • GDP – Gross Domestic Product • The value of goods and services produced within a country during a time period • GNI – Gross National Income • The value of goods and services produced within a country plus net income from abroad • GDP/GNI per head/per capita • GNI divided by the total population

  8. Economic Growth • High economic growth fuelled through capital spending can hide a number of underlying economic problems Shopping Mall in Saudi Arabia Dubai Skyline

  9. National Income – Problems with using GDP/GNI • Reliability of data? • How accurate is the data that is collected? • Distribution of income? • How is the income distributed? • Does a small proportion of the population earn a high percentage of the income or is income more evenly spread?

  10. National Income – Problems with using GDP/GNI • Quality of life? • Can changes in economic growth measure changes in the quality of life? • Does additional earnings power bring with it additional stress, increases in working hours, increased health and family problems?

  11. Development • Development incorporates the notion of measuring human welfare • It is open to interpretation and subjectivity • What should it include?

  12. Development • Levels of poverty • Absolute poverty • Relative poverty • Inequality

  13. Poverty in the World

  14. Poverty in the U.S.

  15. How is Poverty Measured? • https://www.youtube.com/watch?v=mFHctW3zQgg&feature=player_embedded

  16. What is Poverty? • Poverty is a ‘relative’ term Romanian gypsies – is this man living in poverty? Or is this villager in rural China?

  17. Development • Other considerations of human welfare: • Political freedoms? • Sustenance? • Sustainable development? • Self esteem?

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