changing economic world

• what is development?

  measures how economically, socially, culturally and technologically advanced a country is
• what is quality of life?

  term used to evaluate the general well-being of individuals and societies - not economic
• what is standard of living?

  based primarily on income. refers to level of wealth, comfort, material goods and necessities available to a certain group of people in a certain geographical area
• what are first, second and third world countries?

  • first world: capitalist free-market countries e.g usa
  • second world: centrally planned, socialist or communist countries
  • third world: least developed countries and developing countries
• what is the north-south divide?

  • division that exists between the wealthy developed countries
• what is income based classification (world bank)?

  • classifies countries into four income groups:
  • low income, <= $1,045
  • lower-middle income, $1,045 - $4035
  • upper middle-income, $4035 - $12475
  • high income, >= $12475
• what is the fivefold proposal?

  • rich industrializing countries
  • oil exporting countries
  • former centrally planned (communist) countries
  • heavily indebted poor countries
• what is gross national income? (GNI)

  the total value of a country's goods, services and overseas investments divided by the number of people in that country
• what is the birth rate?

  the number of births per 1000 per year
• what is the death rate?

  the number of deaths per 1000 per year
• what is infant mortality?

  the number of babies, under 12 months, dying per 1000 live births
• what is life expectancy?

  the number of years a person is expected to live
• what is people per doctor?

  population divided by number of doctors available
• what is adult literacy rate

  the percentage of adults able to read and write
• what is the human development index (HDI)

  development indicator that combines life expectanct at birth, education and income
• outline limitations of economic measures of development

  • example: GNI
  • doesn't show people's quality of life, which is important in social terms as development doesn't include just economic factors
  • value of currencies are constantly changing, data needs to be updated frequently
  • won't include earnings from other professions such as entertainment, underestimating economy
• what does the demographic transition model show?

  shows and describes how the population of a country changes over time
• what is natural increase?

  difference between number of births and number of deaths
• what is natural decrease?

  happens when there are more deaths than births in a population over a given time period
• what does the 1st stage in the DTM show?

  • high birth rate
  • high death rate
  • stable/ slowly increasing natural increase
  • many children needed for farming, many die at early age
  • religious/social encouragement
  • disease, famine
  • poor medical knowledge, so many children die
• what does the 2nd stage of the DTM show?

  • high birth rate
  • death rate falls rapidly
  • natural increase: very rapid increase
  • many children needed for farming
  • improvements in medical care, water supply and sanitation
• what does the 3rd stage in the DTM show?

  • birth rate falls
  • death rate falls more slowly
  • natural increase: slows down
  • improved medical care and diet - fewer children needed
• what does the 4th stage in the DTM show?

  • low birth rate
  • low death rate
  • natural increase: stable/ slow increase
  • good health, improving status of women, later marriages, less babies
  • good health care, reliable food supply, less deaths
• what does the 5th stage of the DTM show?

  • birth rate is very low
  • death rate is low
  • natural increase: slow decrease
  • good health, improving status of women, later marriages
  • reliable food supply
• advantages of the DTM

  • describes what happened in the UK
  • dynamic, shows changes through time
  • many other countries went through similar stages as they industrialised
• disadvantages of the DTM

  • based on t he experience of industrialised countries so is not relevant to non industrialising countries
  • model does not help predict what can happen to countries
  • some countries may develop through stages faster
• what are 3 causes of uneven development?

  • economic
  • physical
  • historical
• economic factors affecting development

  • low investment in key areas
  • can become vulnerable to ill health which reduced productivity in the work force
  • lack of education means lower quality workforce
  • difficult to expand from a low base
  • wars can affect a country's economy severely
• physical factors affecting development

  • climate related diseases
  • lack of natural resources
  • landlocked with bad neighbours
  • climatic hazards
• historical factors affecting development

  • colonial legacies - countries such as the UK, france, spain and germany had colonies across the globe from whom they took people and resources.
  • colonial countries created boarders and created countries that ignored tribal, ethnic and religious differences
  • conflict
• what is the Gini coefficient?

  • measure of statistical dispersion intended to represent the income distribution of a nations residents
  • most common measure of inequality
  • score of 1 - country's entire income goes to 1 person
  • score of 0 - income equally divided among population
• strategies to help reduce the development gap

  • industrial development and large scale investment
  • aid
  • intermediate technology
  • fair trade
  • debt relief and conservation swaps
  • microfinance loans
• industrial development and large scale investment

  example: building a textile factory in bangladesh to produce garments for export

  • creates jobs, boost economic growth, diversify economy, attract foreign investment, increase exports and revenue, improve infrastructure
  • lead to environmental degradation, displacement, exploitation, dependence on foreign investment and tech, lack of long term sustainability
• aid

  • example: one laptop per child, funded by google, helped distribute laptops to hundreds or thousands of children and teachers in south america and africa
  • provide immediate support for basic needs, long term development by supporting sustainable projects and programs
  • dependence on foreign aid can create a lack of incentive, start a cycle of poverty, corruption and lack of effective use
• intermediate technology

  • example: a non profit organization ptoviding solor powere irrigation pumps to small farmers in ethiopia
  • increase productivity, improve living standards, reduce dependency on fossil fuels, sustainable development
  • costly to implement and maintain, lack of technical expertise and maintenance, limited access to spare parts
• fairtrade

  example: fairtrade cocoa producer in ghana receiving fair prices for their crops

  • promote sustainable and equitable economic development, fair prices to help cover cost of practices and improve livelihoods, improve conditions, promote environmental conservation
  • difficult to enforce and monitor, lack of consumer awareness and demand, higher prices for goods
• debt relief and conservation swaps

  example: honduras receiving debt forgiveness in exchange for protection and managing their natural resources

  • reduces burdens, promote conservation and sustainable use of natural resources and improve economic stability
  • difficult to implement and monitor, lack of transparency and accountability, corruption
• microfinance loans

  example: grameen bank providing loans to small business in india to expand and improve livelihoods

  • can provide access to credit and financial services, promote entrepreneurship and economic development and improve standard of living
  • high interest rates
• what is an example to show how the growth of tourism reduces the development gap?

  jamaica
• tourism in jamaica

  • contributes over 50% of country's total foreign exchange earnings
  • tourism employs the second largest number of jamaicans (200,000) directly in hotels, transport and attractions
  • indirectly in trading, manufacturing and banking
  • benefits local farmers through sale of produce to hotels
  • jamaica's sandals resort farmers program grew from 10 farmers in 1996 supplying 2 hotels, to 80 farmers in 2004 supplying hotels island wide.
  • 2018, hotel chain provided more than $25 million
  • investments in infrastructure