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Development: Measurements. Measuring what, how , and where wealth is produced Development implies progress in technology, production, and socioeconomic well-being (not necessarily happiness)

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Development measurements

Development: Measurements

Measuring what, how, and where wealth is produced

Development implies progress in technology, production, and socioeconomic well-being (not necessarily happiness)

Gross National Product (GNP): total value of officially recorded goods & services produced, inside and outside a country’s territory

Gross Domestic Product (GDP): total value of officially recorded goods & services produced inside a country’s territory

Development measurements1

Development: Measurements

Gross National Income (GNI): monetary worth of all products + investment income – payments to other countries

Per capita GNI: GNI / population

Includes only formal economy

Informal economy: uncounted or illegal economy, not taxed or recorded

Masks extremes of wealth/poverty within a country (e.g., UAE)

Development measurements2

Development: Measurements

GNI also measures only outputs, cost to environment or health

Other ways to measure development:

% of workers in certain fields (technology, food production

Transportation & communication facilities per person

Infrastructure per person

Dependency ratio: number of supported dependents

Various statistics (e.g., literacy, infant mortality, savings, etc.)

Development models

Development: Models

“Development” has possible western bias

Rostow’s Modernization Model: based on economically powerful countries

1: traditional (subsistence farming)

2: preconditions for takeoff (new leadership, openness, flexibility)

3: takeoff: (a kind of industrial revolution

4: drive to maturity (technology, specialization, international trade)

Development models1

Development: Models

Rostow’s Ladder of Development: criticisms and limitations

Fails to take into account context: not every country’s experience the same

Making “industrialization” the ultimate goal doesn’t take into account the negative effects of, for example, too rapid industrialization

Development theories

Development: Theories

Neocolonialism: major world powers continue to control economies of politically independent poorer countries (e.g., diamonds in South Africa)

Structuralist Theory: fundamental economic structures can’t be changed quickly

Dependency Theory: poorer countries remain dependent upon wealthy nations

Dependency established during colonialism

Dollarization: change to U.S. currency means that a nation is dependent on monetary policies of U.S. government

Development theories1

Development: Theories

World-Systems Theory: not all places can be equally wealthy in a capitalist economy

Socio-economic change occurs differently in different places

Capitalism ensures that the powerful will always seek to dominate the less powerful

Core-periphery relationship can exist in regions, within countries, etc.

Development goals barriers

Development: Goals & Barriers

UN Human Development Index: long and healthy life, knowledge, decent standard of living

Millennium Development Goals: 2015

Social Conditions Barriers:

Birth rates, nutrition, many dependents, poor health care, sewage and water, lack of education access especially for girls

Trafficking: adults and children manipulated into conditions they don’t choose

Development goals barriers1

Development: Goals & Barriers

Foreign Debt barrier: strings attached to loans

IMF and World Bank

Structural adjustment loans: loans required reforms (privatization, foreign trades, reduced tariffs, foreign investment)

Repaying principal plus interest may be higher than revenues

Neoliberalism: government intervention into markets should be resisted = privatization

Loan defaults decrease the chance of future foreign investment

Development goals barriers2

Development: Goals & Barriers

Disease: vectored (spread by host and intermediate host) in hot, humid places

Malaria: infant and child mortality, one million die each year, mosquito-killing drugs cause cancer, attempts today at genetic interference

Political corruption: worsened by poverty (is wealth necessary for democracy?)

Peripheral countries: less chances of democracy and elections

Economic instability = political instability (e.g., Afghanistan, Zimbabwe)

Development costs

Development: Costs

Export Processing Zones (EPZ): favor foreign investors with tax breaks, de-regulation, trade incentives

Maquiladoras (Mexico) / special economic zones(China)

Wealthier nations take advantage of these zones for cheap labor, lower taxes, etc.


Development costs1

Development: Costs

Agriculture: large-scale, modernized agriculture produced for foreign consumption

Most farms are small subsistence level with low protein crops

Desertification: results from misuse of soil and erosion, and overgrazing

Africa hardest hit by desertification

Development costs2

Development: Costs

Tourism: strains countries supply system, control by multinational corporation, strain on infrastructure

Creates low-paying jobs

Can debase culture, dehumanize workers, privilege “resort” areas

Natural disasters can stop flow of tourists, disrupt economies

Development institutional influence

Development: Institutional Influence

What contributes to the great disparity between wealth and poverty

Government’s role: control tariffs, taxes, trade, land ownership, environmental laws, etc.

In the U.S., individual states have different laws and policies that affect development (e.g., providing educational opportunities)

Development institutional influence1

Development: Institutional Influence

Islands of Development: governments often prioritize creation of wealth in capital cities

Some governments move colonialist capital to new location to improve economic development in interior regions (e.g., Brazil) or to break ties with the past (e.g., Malaysia)

Corporations also influence development through placement of subsidiaries (e.g., Gabon)

Nongovernmental Organizations (NGOs): non-profit, unregulated funds

Mircocredit program: loans to poor and women, develop small businesses (least successful in most impoverished, diseased regions)