Defining and Measuring Development

Defining and Measuring Development

• Wealth is not solely determined by what is produced but also by how and where it is produced.
• Development focuses on progress in a nation's technology, production, and socioeconomic welfare.
• Gross National Product (GNP) measures the total value of officially recorded goods and services produced by a country's citizens and corporations in a year, both inside and outside the nation.
• Gross Domestic Product (GDP) measures the total value of officially recorded goods and services produced by the citizens and corporations of a country in a year, but only within the nation.
• Gross National Income calculates the monetary worth of what is produced within a country plus income received from investments outside the country.
• To standardize GNI data economists divide the GNI by the population to find the per capita GNI of a country.
• GNI is often unevenly distributed across the population, for example Kuwait and the UAE.
• The GNI only measures output and ignores the damage done to the environment through resource depletion or pollution.
• GNI can be negatively affected by beneficial actions, such as increased use of energy-saving devices.
• Norway had the world's highest GNI as of 2015, with $103,630 per person
• 25% of Norway's income comes from oil and the population is about 5.2 million.
• Qatar has a GNI of $92,000 and citizens total 2.8 million, while most of the wealth stays in the hands of the top 1%.
• The formal economy is legal, taxed, and monitored.
• The informal economy is illegal or uncounted, often including black market activities such as the drug trade, and keeps some countries afloat (ex: Mexico, Afghanistan).

Classical Development Model (Walt Rostow's Modernization Model)

• Designed to explain how modern countries have developed and predict the path of developing countries.
• It assumes that all countries can develop to the same level
• It assumes that all countries will take the same path of development.
• Stage 1: traditional society involving subsistence farming, rigid social structure, and low technology.
• Stage 2: preconditions for takeoff, new leadership creates conditions for takeoff through flexibility, openness, and diversification of the economy.
• Stage 3: takeoff, with an industrial revolution, sustained economic growth, urbanization, mass production, and technology improvement.
• Stage 4: drive to maturity, where technologies diffuse, industrial specialization occurs, and international trade expands, modernization is evident and population growth slows.
• Stage 5: high mass consumption, with high incomes, widespread production of goods and services, and a dominant service sector.
• The classical development model, also known as the ladder of development, remains one of the most influential models on development despite criticisms

Problems With Rostow's Model

• Resources are not evenly distributed affecting countries with a finite amount internally
• Can't depend on things like dwindling copper prices
• Stagnation of the world market leads to limitations for purchasing power
• Increased Dependence of Most Developed Countries, Rostow's model is a more applicable approach to development than the self-sufficiency model in the modern era
• Countries implementing more modern approaches like international trade are seeing much bigger results
• The World Trade Organization (WTO) was founded to remove barriers to International Trade

Development and Development Continuum

• Development involves improving people's material conditions through the spread of knowledge and technology.
• More Developed Country (MDC) has progressed relatively far on the development continuum.
• Less Developed Country (LDC) refers to a country in an earlier stage of development, also called a "developing country" or "third world country".
• Development is important because it increases food availability, shelter, health, protection, improving levels of living, jobs, education, expansion in economic/social issues
• The United Nations Development Program Overview studies Gross Domestic Product(GDP), Types of Work, Education and literacy, Health and Welfare, Life Expectancy, Gross National Product, Literacy rate- the percentage of a country's people who can read and write.
• Human Development Index (HDI) measures development through economic, social, and demographic factors.
• The economic factor is a country's GDP per capita.
• Social factors are literacy rate and education level.
• The demographic factor is life expectancy.
• Developed countries, such as Norway, Australia, Switzerland, the Netherlands, and the United States top the Human Development Index (HDI) list, and countries such as Sierra Leone, Chad, Central African Republic, DR Congo, and Niger feature at the bottom.

Geography, Context, and Development

• Context affects development across scales (local, state, regional, global).
• Due to European colonialism, colonies became dependent on mother nations while providing riches.
• Neocolonialism signifies that the economies of formerly colonized countries are still manipulated by world powers.
• Structuralist theory is a model of economic development that treats inequalities among countries and regions result of the results of power relations within the global economic system.
• Neocolonialism, argues that the connections and political ties between nations restrain poorer areas.
• There is more power due history/economics that the former colonies are affected by even today.
• The way/the why colonies were created still affects/limits growth
• Social conditions, high infant/child mortality, lack of education, views on gender are examples of the barriers to development.
• Too many young deaths leads to poor, uneducated society.
• In some areas females are not given the opportunity to attend schools compared to males
• Gender plays role when young girls end up contributing to family, this leads to trafficking.
• Trafficking which is akin to slavery without a person is problem for women in some areas
• Countries in debt have structural adjustment loans with strings attached to things like privatizing government entities and reducing tariffs.
• Debt forces people to choose either the country gets things it needs/revenue which can drive into bankruptcy
• International Monetary Fund is composed of primarily of European banks, they sought changes that benefited European traders.
• Neoliberalism combined with high government spending plus rampant corruption may have led to economic crises.

Additional Barriers in Development

• Malaria is a vectored carried carried by mosquitos is a barrier
• Only exists in warm, moist climate where mosquito live
• Kills about 150,000 children a month or 2 million a year who are under age of 5
• Common in Latin American, Asia and Africa
• DDT- Was used to kill mosquitos, but potential link to humans discontinued the use
• Disease has been the reason of death for Alexander the Great
• Modern way of fighting is the usage of mosquitos

Political Instability in Development

• Establishing political control in low income or war torn communities is difficult
• An example of this Afghanistan
• Former colonial societies left elites in charge which resulted in instabilization and corruption
• Poverty can lead to civil war especially from people in poverty
• A prime example is Robert Mugabe in Zimbabwe
• Similarly he stays in power out of fear
• As does Fidel Castro

Costs of Economic Development

• Any kind of changes lead to economic challenges
• Agriculture in periphery or semi periphery can be by farming or big industries
• These things lead to people not benefiting the local population
• The land of small farms is small and wont amount in big income
• Often don't have proper resources

Ripple effects

• industrial production can lead to air and surface water pollution
• agricultural production can lead to herbicides and pesticides
• Too high levels of tourism can affect cultures
• To attract nations trade zones are created for better regulation
• The Maquiladoras are zones located in northern Mexico with better regulation and American companies can transfer goods from the U.S to them with no taxes

Additional Factors to Influence

• Tourist portions depend on Shanty houses to work, leaving workers in poor areas
• Political economic factors lead to uneven development of nations
• Many islands are wealthy compared to the country side
• Local governments play huge role in the disparity, tariffs/taxes and environmental conditions are key
• Islands of technology are created through governments and major cities

Growth in semi-periphery and periphery

• NGO's work to help increase issues
• They are Independent organizations.
• Micro-credit programs give small loans to the poor, specifically women with a 98% rate of success
• Increase power to the communities.

Explore how development is measured beyond production, focusing on technology and socioeconomic welfare. Learn about Gross National Product (GNP), Gross Domestic Product (GDP), and Gross National Income (GNI) as key indicators. Understand GNI's distribution and limitations in reflecting true development.