The Changing Economic World

• Development is the progress a country has made in terms of economic growth, use of technology and human welfare. It is influenced by economic, environmental, social and political factors.
• Development means positive change that makes things better. As a country develops it usually means that people's standard of living and quality of life will improve.
• The development gap is the difference in standards of living between the world's richest and poorest countries.
• Different factors affect a country's level and speed of development

  • Environmental factors such as natural hazards e.g. earthquakes.
  • Economic factors such as trade and debt.
  • Social factors such as access to safe water and education.
  • Political factors such as stable government or civil war.
• Gross National Income (GNI) is the total value of goods and services produced by a country, plus money earned from, and paid to, other countries.
• Human Development Index (HDI) links wealth to health and education. IT aims to show how far people are benefiting form a country's economic growth.
• HDI is a social measure which uses:

  • life expectancy at birth
  • number of years of education
  • GNI per head
• A good quality of life will mean different things in different countries. Consider, for example, safety and security, freedom and the right to vote, women's rights and happiness.
• Birth rate is a reliable measure. As a country develops, women are likely to become educated and want a career rather than staying at home. They often marry later and have fewer children.
• Death rate is a less effective measure. Developed countries such as the UK, Germany and Japan tend to have older populations and death rates will be high. In less developed countries, such as the Ivory Coast or Bangladesh, death rate may be lower because there are proportionally more young people.
• Infant mortality rate is a useful indicator of a county's health care system.
• The number of doctors per 1000 people indicates how much money a country has fro medical services.
• A high literacy rate shows a country has a good education system.
• A high percentage of access to clean water shows a country has modern infrastructure, such as dams, reservoirs and water treatment plants.
• The Demographic Transition Model shows changes over time in the population of a country. It is based on the changes that took place in western countries such as the UK.
• The gap between birth rate and death rate is called natural change.
• Physical causes of uneven development:

  • Landlocked countries have no access to the sea meaning that a country is cut off from seaborne trade, which is important for economic growth.
  • Climate-related diseases and pests affects the ability of the population to stay healthy enough to work.
  • Extreme weather can slow development and it can be costly to repair damaged infrastructure.
  • The lack of adequate supplies of safe water is a barrier to economic development.
• Low life expectancy, frequent illness and the lack of a nutritious diet make economic development hard to achieve.
• Development is uneven due to resources as they are not evenly distributed throughout the earth so creating

  disparities between different countries.
• Some countries have physical resources (oil, gas etc) and others have human resources (that can be used for labour). This can lead to uneven development.
• Physical, historical and economic reasons can effect how developed a county is.
• Measures of Development:

  • Gross National Income (GNI) per head
  • Birth rate
  • Death rate
  • Infant mortality rate
  • Life expectancy
  • People per doctor
  • Literacy rate
  • Access to safe water
  • Human Development Index (HDI)
  • Quality of life
• The Brandt line


  An imaginary line made popular in the 1980s to distinguish the Global

  North (Rich) and Global South (poor).
• The Brandt Line

  
• The HDI is a measurement system used by the United Nations to evaluate the level of individual human development in each country.
• The HDI uses components such as average annual income and educational expectations to rank and compare countries.
• The HDI has been criticized for not representing a broad enough measure of quality of life and for providing little additional useful information beyond simpler measures of the economic standard of living.
• The Demographic Transition Model (DTM) is the transition from high birth and death rates vto low birth and death rates as a country develops from a pre-industrial to an industrialized economic system.
• Lines on the Demographic Transition Model (DTM):

  • The graph shows us the birth rate. Think about the sort of things that effect birth rate (contraception, family planning, need for large families, high infant mortality etc).
  • The graph shows us the death rate. Think about the sort of things that effect death rate (health care, clean water, reliable food supply etc).
  • This line shows us if the population is high or low – not the actual number. It also shows us if the population is growing, shrinking or stable.
• Stage 1 of the DTM:

  • Britain up to 1740. Most people lived in the countryside and worked on the land. Couples had large families because many children died in early childhood. Parents also wanted to make sure they had enough children to look after them in old age because pensions were not available for ordinary people. Knowledge about diseases was limited and people often died form their illnesses.
  • Now, traditional rainforest tribes – in parts of Indonesia, Brazil and Ecuador, small numbers of people live with little contact with the outside world.
• Stage 2 of the DTM:

  • Britain 1740-1880 During the Industrial Revolution the development of new industries, such as textile and steel, led to the growth of new towns. People moved from the countryside to towns for work in the new factories. Better health care and sewage systems meant that people were healthier than they had been before.
  • Now, Afghanistan – an extremely poor country. 79% of people are farmers so need children to help with crops and animals. In the city the is access to medical care which reduces the death rate. Lots of young people move to cities.
• Stage 3 of the DTM:

  • Britain 1880 - 1940. The standard of living continued to rise. Education was free and early forms of contraception meant that people could choose to have fewer children. Both life expectancy and infant mortality improved.
  • Now, Brazil has a fast developing economy. It’s population will have doubled between 1975 and 2015. Improving standards of living mean people can see the benefits of having fewer children.
• Stage 4 of the DTM:

  • Britain 1940 to present. People are now able to see a doctor quickly and there are treatments available for serious illnesses and injuries. Working conditions have improved due to health and safety laws. Many people enjoy the benefits of an increased income and are able to buy luxury goods such as TVs, games consoles and have at least one holiday a year. This has meant that people sometimes choose to have only one or two children – or none at all – in order to afford a luxury lifestyle.
  • Now, USA – largest and most developed economy in the world. As well as the UK.
• Stage 5 of the DTM:

  • The future of Britain. Many Eastern and a few Western European countries are at Stage 5, but for different reasons. Death rate rises because the population includes more elderly people. In Eastern Europe an uncertain economydiscourages people from having babies. In Western Europe economies give women so many career opportunities that they decide to be childless or to postpone motherhood.
  • Now, Germany, one of the first countries to reduce its birth rate. When today's middle aged people become elderly, there will be few adults of working age to support them.
• Limitations of the DTM:

  • It is a generalisation
  • Not all countries follow the same pathways or have the same oppurtunities.
  • Countries that do follow the DTM do so at different speeds. The factor that determines how fast a country passes through the DTM will depend on development.
• Why is development uneven?:

  • Development is uneven due to resources. These are not evenly distributed throughout the earth so creating disparities between different countries.
  • We have physical resources (Oil, Gas etc) and we have human resources (labour).
  • We can break all this down into Physical, historical and economic reasons that can effect how developed a county is.
• The Poverty Cycle:

  A) investment

  B) growth

  C) income

  D) capital

  E) infrastructure

  F) Low

  G) human capital

  H) workforce

  I) productivity

  J) attractive

  
• Low investment in key areas such as infrastructure (roads, rail, telecommunications etc.), education and healthcare can be detrimental for a population.
• Populations in countries at low levels of development can become more vulnerable to ill health which reduces the productivity of the workforce.
• A lack of education leads to a lower quality workforce and poor road networks are not attractive to outside investors. Simple things like these can exacerbate (make worse) poverty and keep countries mired in a low level of development.