DEVELOPMENT & DISPARITIES

1. DEVELOPMENT & DISPARITIES Development can be expressed as : Global disparities – the developed north versus the less developed south. Regional disparities –core and peripheral areas. Local disparities – between the inner city suburbs and rich suburbs.

2. DEPENDENCY MODEL Disparities in development between Britain and the Caribbean . • Proposed by Gunder Frank (1967) notion ‘the development of underdevelopment’ in terms of the domination of the capitalist world and dependence of the Third World. • The main suggestion has been that underdevelopment an initial condition or state maintained from within the LDC as a result of some deficiency or blockage in their physical or human resources. • Underdevelopment is a process resulting from the interaction between the MDCs and LDCs . • NB: As development has proceeded in the MDCs , its corollary underdevelopment has occurred in the LDCs.

3. DEPENDENCY MODEL Disparities in development between Britain and the Caribbean • Dependency emerged as a critique of the modernization theory and economic dualism , arguing that Third World poverty was not a function of local famine but rather was a function of the history of dialectical relations between the metropole and satellite. • At heart the theory stands a claim about the dominant role of external (i.e.) global powers and the super exploitation by which the metropole subordinates the satellite. • Surplus value of production in profits are taken by developed countries and transnational companies from the resources and labour of the developing world.

4. DEPENDENCY MODEL Disparities in development between Britain and the Caribbean • The peripheries supplied primary products and low technology manufacturers for the First World in exchange for high technology, high value added goods. • Economic dependency was further expressed through political and cultural neo colonialism . • Aids and loans merely increase dependency . Frank maintains that capitalism will produce dependence unless a new economic and social order can break that dependence.

5. DEFINING COLONIALISM • Defined by Michael Watts (dictionary of human geography) Is the establishment of maintenance of rule, for an extended period of time by a sovereign power over a subordinate and alien people that is separated from the ruling power. • Potter defined colonialism as the domination of a geographically extended political unit, most often inhabited by people of a different race and culture , where this domination is political and economic and the colony exist subordinate to and dependent on the mother country. • Colonialism is the rule over peoples of the developing world by the European powers, especially during the late nineteenth century.

6. COLONIALISM Disparities in development between Britain and the Caribbean • The colonies were dependent to a greater or lesser degree as the colonial powers introduced agricultural systems which annexed their numerical resources , converted their farmlands or opened up new lands for plantation. • They used the native people as slave labour or as cheap labour. • It states that the origins of international inequality can be traced firstly to the spread of mercantilism and trade from the sixteenth and seventeenth centuries and secondly to the spread of political colonialism starting in the sixteenth but increasing especially in the nineteenth century.

7. COLONIALISM Disparities in development between Britain and the Caribbean • The metropolitan countries of Europe such as Spain, Britain , Germany , France are seen to have become highly industrialized and developed nations through the international exploitation of the colonies over which they held political sovereignty. • The cash crops and plantations led to monoculture , which was not a problem for a colony but on independence, such dependence on a single crop was economically dangerous because of fluctuations in the world demand and price paid for the crop. • Many former colonies were left with too narrow of an economic base and too little diversity of export earnings.

8. COLONIALISM Disparities in development between Britain and the Caribbean • The British colonial office perceived a Federation as an ideal solution to achieving independence for the British West Indian territories, mainly for administrative and financial purposes. • The concept was also popular in many islands, as it provided the only enabling formula which allows them to meet the test for self government. • There were many obstacles to Federation, many of these obstacles stem from the British colonial policies: • Britain fostered a sense of division among its colonies as a way to enhance control; there was little direct communication and trade among the colonies as each dealt primarily with London and there were wide disparities in the level of economic and political development among the British colonies.

9. COLONIALISM Disparities in development between Britain and the Caribbean • The West Indies Federation had its origin in the Montego Bay Conference of 11-17 September 1947. It was created in 1958 to facilitate the transition to independence for a number of British colonies with Grantley Adams (of Barbados), as Federal Prime Minister . • The eventual demise of the Federation came as a result of Jamaica’s decision to withdraw following a referendum (vote on an important political question open to all the electors of a state) held on September 19,1961 , in which 54.11% of the electorate voted ‘No’ to the question ‘Should Jamaica remain in the Federation of the West Indies?’

10. COLONIALISM Disparities in development between Britain and the Caribbean • This was due to widespread perception among Jamaicans that their country, as the federation’s largest economy, would be subsidizing its less developed partners. • Trinidad and Tobago subsequently announced its decision to withdraw and the Federation was officially dissolved on May 31st 1962. • Jamaica became the first British colony in the Caribbean to become independent on August 6, 1962, with Trinidad and Tobago following on August 31st of the same year.

11. COLONIALISM Disparities in development between Britain and the Caribbean • The idea of a reduced Federation continued to attract some attention until the mid 1960’s , this swiftly became perceived as Britain trying to pass financial responsibility to Barbados for supporting the ‘Little Eight’ and Barbados became independent on its own in 1966. • ‘Associate state’ status was introduce for Antigua and Barbuda, St. Kitts –Nevis , The Windwards (Dominica, Grenada, St. Lucia, St. incent and the Grenadines), which represented an upgrade from colonial status to something just short of full internal self government and most of these nations became fully independent in the late 1970s. St.Kitts –Nevis is the most recent English speaking Caribbean island nation to become independent (1983).

12. COLONIALISM Disparities in development between Britain and the Caribbean • British Guiana and British Honduras remained outside the federal experiments and became independent as Guyana (1966) and Belize (1981), whilst Anguilla, the British Virgin Islands, Cayman Islands, Montserrat and Turk & Caicos Islands remain possessions of the United Kingdom with internal self governments.

13. COLONIALISM Disparities in development between Britain and the Caribbean • Some argue that colonialism has had beneficial effects on the economic ,social and political structures of the LDCs. • Colonial governments established law and order, suppressed tribal conflict and civil war, safe guarded private property , established basic transport and health services. • Contacts with the metropole acquainted the colonial population with new wants, crops, commodities and methods of cultivation and sere to established new markets for local produce.

14. ROSTOW’SMODEL OF DEVELOPMENT W.W. Rostow was an American economist who proposed five (5) stages of economic growth.

15. History of The Rostow Model One of the first models to account for economic growth, and probably still the simplest was put forward by W.W.Rostow in 1960. He suggested that all the countries in his study had the potential to break the cycle of poverty and develop through five linear stages.

16. The Stages of Economic Development This is a linear theory of development. Economies can be divided into primary secondary and tertiary sectors. The history of developed countries suggests a common pattern of structural change:

17. Changes in employment structure based on the Rostow Model

18. What was the model ? Every society had to pass through these five stages, if they were in transition to modernity or development.

19. Rostow’s Model of Economic Growth

20. STAGE 1 Traditional Society • The economy is dominated by subsistence activity. • Output is consumed by producers rather than traded. • Any kind of trading is done by bartering. • Agriculture is the most important industry thus making production labour intensive.

21. Stage 1 Traditional Society Subsistence economic activity i.e. output is consumed by producers rather than traded, but is consumed by those who produce it; trade by barter where goods are exchanged they are 'swapped'; Agriculture is the most important industry and production is labour intensive, using only limited quantities of capital. 

22. STAGE 2 Pre-conditions of modernization • Industrialization would have just began. • An emergence of transport and infrastructure to support trade. • Savings and investment grew This resulted in entrepreneurs emerging and external trading.

23. Stage 2 Transitional Stage (the preconditions for takeoff) Surpluses for trading emerge supported by an emerging transport and infrastructure. Savings and investment grow. Entrepreneurs emerge. 

24. STAGE 3 • Take Off Stage • Industrialization increased. • Workers switched from the agricultural sector to the manufacturing sector. • Economic Transitions Evolution of new political and social institutions to support industrialization. Generates increasing incomes and therefore able to sustain more investment.

25. Stage 3 Take Off Industrialization increases, with workers switching form the land to manufacturing. Growth is concentrated in a few regions of the country and in one or two industries. New political and social institutions are evolve to support industrialization. 

26. STAGE 4 Drive to Maturity • The economy begins to diversify into new areas. • Technological innovation A diverse range of investment opportunities.

27. The economy begins to produce a wider range of goods and services. Less reliance on imports. Stage 4 Drive to Maturity :Growth is now diverse supported by technological innovation. This diversity leads to greatly reduced rates of poverty and rising standards of livivng, as the society no longer needs to sacrifice its comfort in order to strengthen certain sectors.

28. STAGE 5 • High Mass Consumption • Economy is geared towards mass consumption. • The service sector becomes increasingly dominant.

29. The age of high refers tothe period of contemporary comfort afforded many western nations, wherein consumers concentrate on durable goods, and hardly remember the subsistence concerns of previous stages mass consumption Stage 5 High Mass Consumption

30. Failures of the Rostow Model Rostow's model is limited. The determinants of a country's stage of economic development are usually seen in broader terms i.e. dependent on: The quality and quantity of resources, a country's technologies, a countries institutional structures e.g. law of contract.

31. Rostow's model explains the development experience of Western countries, well. However, Rostow does not explain the experience of countries with different cultures and traditions e.g. Sub Sahara countries which have experienced little economic development.

32. The Rostow model assumes incorrectly that all countries start off at the same level. • It predicts to short a timescale between the beginning of growth and the time when a country becomes self-sustaining. It over emphasizes the effect of the learning curve i.e. the time taken for a country to develop diminishes as countries learn from others that are developed.

33. Its generalized nature makes it somewhat limited. • It does not set down the detailed nature of the pre-conditions for growth. • In reality policy makers are unable to clearly identify stages as they merge together

34. Strengths of the Model According to a report on Human Development :- • Our economic self-interest calls for rapid development of the rest of the world: our export markets will thereby grow and there will no longer be the lure of low wages to our jobs. • A richer world is likely to be a more peaceful world.

35. Savings and capital formation (accumulation) are central to the process of growth hence development. The key to development is to mobilize savings to generate the investment to set in motion self generating economic growth.

36. Development can stall at stage 3 for lack of savings – 15-20% of GDP required. If the domestic Savings rate is 5%, then international aid/loan must total 10-15% in order to plug the ‘savings gap’. Resultant investment means a move to stage 4 Drive to Maturity and self-generating economic