Economic Development

1. Economic Development - Industrialization and Economic Development -

2. Economics Economics is the study of : 1. production of goods and services. 2. distribution of goods and services. 3. consumption (purchasing) of goods and services. Economic Geographers study how people make a living.

3. Economic Globalization • Interdependence of national economies through movement of goods, service, technology and capital ($$$). • Much of the world's economic activity is now transnational. • How is the economic development of a country measured? See next slides …

4. How is the economic development of a country measured? (1/4 )Key Terms • Per Capita Income: Per person income. • Gross National Product (GNP): Total production of goods and services by a country within a year. • Gross Domestic Product (GDP): Total production of goods and services within a country during in a year

6. Range of World GNP • World Average…………………….$4920 • Developed Countries…………...$19,310 • Developing Countries……………$1,120 • Lowest GNP………….$80. Mozambique • Highest GNP……..$41,210 Luxembourg

7. GNP Continuum Poor Countries Rich Countries Developed Average $19,310 Developing Average $1,120 Mozambique $80 Luxembourg $41,210 USA $26,980 World Average $4920

9. Developing Countries high birth rates (5%) high infant mortality (150+) high fertility (7.4) high pop under 15 (50%) low pop over 65 (1%) short life expectancy (43 yrs.) Developed Countries low birth rates (1%) low infant mortality (.4%) low fertility (1.1) low pop under 15 (15%) high pop over 65 (18%) long life expectancy (80 yrs) How Is The Economic Development of a country Measured? (2/4) Demographic (characteristics of a human population) Signs of Development

10. Social Signs of Development How is the economic development of a country measured? (3/4) • Use of consumer goods: phones, TV’s, computers • Distribution of wealth & services • health care availability • number of physicians per capita • education availability • Literacy Let’s look at the following slides …

14. How Is The Economic Development of a country Measured? (4/4)Structure of the Economy • Economic activities are divided into categories of increasing complexity • Primary Sector • Secondary Sector • Tertiary Sector • Quaternary Sector Secondary Primary Tertiary Quaternary

15. Economic Sectors: Structure of the Economy • Primary Industry: extraction of resources from the earth. • Generally, through agriculture, mining, fishing and forestry. • EX: • farming, lumber, harvest.

16. Economic SectorsStructure of the Economy • Secondary Industry - processing and manufacturing of resources • manufacturing

17. Economic SectorsStructure of the Economy • Tertiary Industry - distribution of goods and services. Employs most people in the labor force in developed countries. Ex: trucking, banking, retail store outlets, groceries

18. Economic SectorsStructure of the Economy • Quaternary Industry - processing and dissemination of information • The “Information Economy”, services related to information and research. • education, research & development, cyber • space

19. Measures of Development • Consumer Goods (examples?) • Fertility Rate • Infant Mortality Rate

20. Fertility and Infant Mortality Rate • Developing countries have higher fertility rates than developed countries. • Developed countries have lower infant mortality rates than the developing countries.

21. Economic Theories • Classical Liberalism • Neo-Liberalism • Dependency Theory • Globalization

22. Classical Liberalism • An economic system functions best when there is no interference by government. • “Laissez-faire” (hands off, leave things alone!)

23. Neo-Liberalism • Private enterprise • Liberalized trade • Open markets • Maximized role of private sector to determine political and economic priorities of the state.

24. Dependency Theory • Resources flow from a poor and underdeveloped states to a "core" of wealthy states, enriching the latter at the expense of the former. What about Globalization Theory???