Development Economics and Policy

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Questions and Answers

What was described as the core of development ideas during the 1950s and 1960s?

Pure market forces and competition

Government intervention and control

External economies and increasing returns (correct)

Resource allocation and distribution

What does the 'new' endogenous growth theory suggest about income differences?

They are persistent due to various externalities. (correct)

They are largely determined by government policies.

They will eventually lead to equal income levels worldwide.

They are solely caused by technological advancements.

According to the 'new' endogenous growth theory, what factors contribute to technical progress?

Investment in research and development, and education (correct)

Government subsidies and regulations

External market demands and interest rates

Market competition and resource availability

What did Paul Krugman believe happened to many important models of development from the 1950s and 1960s?

They were lost due to inadequate formulation. Signup and view all the answers

What key aspect does not align with conventional neoclassical growth theory regarding growth?

Investment plays a critical role in determining growth. Signup and view all the answers

What major themes did developing countries pursue in terms of policy?

Mobilization of underemployed manpower Signup and view all the answers

What is one of Hirschman's arguments regarding the decline of development economics?

The success of free-market countries undermined development theory. Signup and view all the answers

Which countries are referred to as the ‘East Asian miracle’ countries?

South Korea, Hong Kong, Taiwan, and Singapore Signup and view all the answers

What do neo-Marxists reject regarding development economics?

The claim of mutual benefit between rich and poor countries Signup and view all the answers

Who are the scholars mentioned that supported the traditional concerns of development theory?

Amartya Sen and Syed Naqvi Signup and view all the answers

What was the initial call for a new international economic order made during?

The Sixth Special Session of the United Nations General Assembly Signup and view all the answers

What was one of the main goals of the United Nations concerning developing countries?

To correct inequalities and redress existing injustices Signup and view all the answers

What percentage of world manufacturing production was the Lima Declaration aiming for developing countries by the year 2000?

25% Signup and view all the answers

What factor contributed to developing countries meeting their manufacturing target set by the Lima Declaration?

Rapid industrial growth in East Asia and the Pacific Signup and view all the answers

Which of the following was NOT included in the proposed actions for a new international economic order?

Increased taxes on wealthy nations Signup and view all the answers

What is one of the key principles emphasized for the new international economic order?

Equity and common interest Signup and view all the answers

Which international entity produced the Lima Declaration in 1975?

United Nations Industrial Development Organization (UNIDO) Signup and view all the answers

What is one objective of the requested reforms in the international economic order?

Greater say in decision-making on trade and development issues Signup and view all the answers

Which of the following describes the state of manufacturing production in developing countries as of 2000?

Met the target of 25% Signup and view all the answers

How did the UN define the objective of the new international economic order?

Facilitate cooperation irrespective of economic systems Signup and view all the answers

Study Notes

Strategic Themes in Developing Countries

Major strategies include mobilizing underemployed manpower, fostering rapid capital accumulation, and promoting industrialization.
Planning is considered essential for successfully executing these strategies.

Decline of Development Economics

Hirschman argues development economics faces challenges from neoclassical orthodoxy, which dismisses the notion of a distinct economic framework for poor countries.
The success of free-market economies in East Asia (South Korea, Hong Kong, Taiwan, Singapore) lends credibility to monoeconomic views.
Neo-Marxists challenge the idea of mutual benefits in development economics, putting further pressure on the field.

Renewed Interest in Development Theory

Key figures like Amartya Sen and Syed Naqvi defend the integration of surplus labor, capital accumulation, and industrialization as vital focuses.
The emergence of new endogenous growth theory revitalizes interest in growth determinants, supported by robust datasets for econometric analysis.
Paul Krugman identifies the 1950s and 1960s as periods of high development theory, which are now being revisited by more rigorous analysts.
Key concepts like external economies, increasing returns, and inter-sectoral linkages re-emerge in contemporary discourse.

International Economic Order

A new international economic order was proposed during the 1974 UN General Assembly to address inequalities between rich and poor nations.
Goals include improved trade terms, better access for developing countries’ goods, increased financial aid, debt alleviation, IMF reform, and technical cooperation.
The Lima Declaration (1975) aimed for developing countries to achieve a 25% share of global manufacturing by 2000; this goal was met and surpassed.

Agricultural Development as a Foundation

Agriculture's state significantly influences a country's development trajectory, providing essential resources for industry and purchasing power.
Factors affecting agricultural productivity include economic institutions, physical conditions, and climate.
Many developing countries experience "urban bias," resulting in resource deprivation for agriculture due to non-rural elite interests.

Global Initiatives for Development

The 1995 Copenhagen Declaration prioritizes full employment, gender equality, and universal access to education and healthcare in social policy.
Calls for the IMF and World Bank to prioritize social factors in development programs have yielded slow progress.
The United Nations Conference on Trade and Development (UNCTAD) emphasizes debt relief, international aid, commodity policy, and trade promotion.

Millennium Development Goals

In 2000, global leaders set the Millennium Development Goals, consisting of 8 goals and 18 targets aimed to be achieved by 2015, reflecting commitments to improve the condition of developing nations.

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Description

Explore the major strategic themes in development economics as pursued by developing countries, including manpower mobilization and industrialization. This quiz delves into Hirschman's perspectives on the challenges faced by development economics in the context of neoclassical orthodoxy.