Development powerpoint part 1


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Development powerpoint part 1

  1. 1. Development Chapter 10
  2. 2. Global Economics <ul><li>Enormous gaps between the rich and poor countries of the world </li></ul><ul><li>Some states are still subsistence based while others have moved beyond manufacturing to tertiary economies. </li></ul><ul><li>Even within the wealthy or First World nations there are often areas of economic disparity within regions </li></ul>
  3. 3. Measuring Development Gross National Product (GNP) Measure of the total value of the officially recorded goods and services produced by the citizens and corporations of a country in a given year. Includes things produced inside and outside a country’s territory. Gross Domestic Product (GDP) Measure of the total value of the officially recorded goods and services produced by the citizens and corporations of a country in a given year. Gross National Income (GNI) Measure of the monetary worth of what is produced within a country plus income received from investments outside the country. ** Most common measurement used today.
  4. 4. Concepts & Approaches <ul><li>Gross National Product -all goods & services produced by the economy per year both inside & outside the nation </li></ul><ul><li>Gross Domestic Product -all goods & services produced by the economy per year with in the nation </li></ul><ul><li>GNP or GDP does not reflect regional variations-it also doesn’t count the informal economy-black market, illegal drug trade & underground economy </li></ul><ul><li>Developed Countries -( DC s) have high levels of industrialization, urbanization & standard of living </li></ul><ul><li>Underdeveloped ( UDCs ) or Developing Countries are moving toward developed status-not as highly industrialized or urbanized with a lower standard of living </li></ul>
  5. 5. Measures of Development <ul><li>National Product per person -the total income divided by total population-Core (developed) about $25,000 while Periphery (developing) as low as $100. </li></ul><ul><li>Occupational Structure of the Labor Force -% of workers in each section-high number in agriculture signals low development </li></ul><ul><li>Consumption of Energy per Person -the greater the use of electricity-the higher the development </li></ul><ul><li>Productivity per Worker -production of all goods divided by the total labor force </li></ul>
  6. 6. Measures of Development <ul><li>Transportation & Communication per person -railroad, road miles and airline connections per person as well as telephone, radio, television or computers per person. </li></ul><ul><li>Consumption of Manufactured Metal per Person -the greater the amount of steel, iron, copper, aluminum etc. used per person </li></ul><ul><li>Other Rates - </li></ul><ul><ul><li>Literacy </li></ul></ul><ul><ul><li>Caloric intake </li></ul></ul><ul><ul><li>% of income spent on food </li></ul></ul><ul><ul><li>Amount of savings per person </li></ul></ul>
  7. 7. Issues with Measuring Economic Development <ul><li>All measurements count the: </li></ul><ul><ul><li>Formal Economy – the legal economy that governments tax and monitor. </li></ul></ul><ul><li>All measurements do not count the: </li></ul><ul><ul><li>Informal Economy – the illegal or uncounted economy that governments do not tax or keep track of. </li></ul></ul>
  8. 8. Core-Periphery Model <ul><li>Immanuel Wallerstein proposed the World Systems Theory with promoted the Core-Periphery concept. </li></ul><ul><li>Unlike the term-developed and developing, the Core-Periphery Model does not imply that change will occur. </li></ul><ul><li>Core-Periphery regionalism got its start during the period of colonialism was re-enforced by the Industrial Rev. and continues in the age of globalization. </li></ul>
  9. 9. Core-Periphery Model <ul><li>New approach to developed or underdeveloped idea </li></ul><ul><li>Core-Periphery also used in a political context </li></ul><ul><li>Core -the nations with a high level of prosperity with dominant economies globally </li></ul><ul><li>Periphery -poor nations that are dependent on the core as markets for raw materials and sources of technology </li></ul><ul><li>Semi-Periphery -better off than periphery, but still dominated by the core to some degree </li></ul>
  10. 13. Global Economic Disparities <ul><li>Much of the disparity existed as Colonialism was established by European nations. </li></ul><ul><li>The Industrial Revolution increased the need for raw materials and markets for finished goods. </li></ul><ul><li>Neo-colonialism refers to the economic dominance of the core over the former colonial nations-economic rather than political control </li></ul>
  11. 14. Conditions in the Periphery <ul><li>High birth rates, moderate death rates and low life expectancy </li></ul><ul><li>High infant mortality rates-large population under age 15 yrs. </li></ul><ul><li>Poor health care & shortage of doctors-disease is common </li></ul><ul><li>Poor sanitation and lack of fresh, clean water </li></ul><ul><li>Poor nutrition and protein deficiency </li></ul><ul><li>Low per capita income with many women & children doing hard manual labor </li></ul><ul><li>High illiteracy rate with low levels of education </li></ul><ul><li>Great disparity between rich & poor, small middle class </li></ul><ul><li>Urban areas overcrowded, lack of services, rapid urban migration </li></ul><ul><li>Subsistence farming on small landholdings </li></ul>
  12. 15. Conditions That Hamper Development <ul><li>Political instability and corruption </li></ul><ul><li>Exploitation of natural resources and workers regardless of consequences </li></ul><ul><li>Dependence of agricultural products or primary products such as mineral resources </li></ul><ul><li>Misuse of foreign assistance </li></ul><ul><li>Misguided priorities </li></ul><ul><li>Cultural resistance to modernization </li></ul>
  13. 16. Costs of Economic Development <ul><li>Industrialization </li></ul><ul><ul><li>Export Processing Zones (EPZs), maquiladoras, and special economic zones (SEZs). </li></ul></ul><ul><li>Agriculture </li></ul><ul><ul><li>Subsistence and agricultural conglomerates </li></ul></ul><ul><ul><li>Desertification-especially in Africa </li></ul></ul><ul><ul><li>Soil erosion </li></ul></ul><ul><li>Tourism -may have serious negative consequences </li></ul><ul><ul><li>Use of scarce commodities </li></ul></ul><ul><ul><li>Foreign investors make the profit </li></ul></ul>
  14. 17. Tourism: Boom or Bust <ul><li>Tourism contributes little to a nation’s development & may have serious negative effects on the culture </li></ul><ul><li>Hotels & other facilities are often owned by transnational corporations which take the profits out of the country </li></ul><ul><li>Tourism jobs can be demeaning & dehumanizing or even insulting </li></ul><ul><li>Tourism jobs pay minimal wages for menial tasks </li></ul>
  15. 18. Tourism: Boom or Bust <ul><li>Profits are reinvested in airports, cruise ship ports & other infrastructure to serve tourists </li></ul><ul><li>Tourists use up valuable resources such as food & fresh water </li></ul><ul><li>Tourism can debase or change a local culture </li></ul><ul><li>An invasion by wealthy foreigners can breed hostility and resentment </li></ul><ul><li>Harsh contrast between gleaming modern tourist hotels and poor workers housing </li></ul>
  16. 19. Levels of Industrialization <ul><li>Some countries like the Soviet Union industrialized quickly with central planning-Stalin’s Five Year Plans </li></ul><ul><li>All decisions were made in Moscow-no local control </li></ul><ul><li>Focus on heavy industry-steel, electrical, chemical, military hardware </li></ul><ul><li>Little emphasis on consumer goods </li></ul><ul><li>Little concern for worker safety or environmental problems </li></ul>
  17. 20. Models of Development <ul><li>There are two broad models of economic development; </li></ul><ul><ul><li>Liberal Models based on the assumption that all countries pass through the same stages of economic development and disparity is the result of short term inefficiencies </li></ul></ul><ul><ul><li>The Liberal Model assumes that all nations are capable of the same level of economic development </li></ul></ul>
  18. 21. Development Models <ul><li>Modernization Model </li></ul><ul><li>Walt Rostow’s model assumes all countries follow a similar path to development or modernization, advancing through five stages of development, climbing a ladder of development. </li></ul><ul><li>- traditional </li></ul><ul><li>- preconditions of takeoff </li></ul><ul><li>- takeoff </li></ul><ul><li>- drive to maturity </li></ul><ul><li>- high mass consumption </li></ul>
  19. 22. Models of Development <ul><li>Walt Rostow created this liberal model of development in the 1960s </li></ul><ul><li>First Stage-Traditional </li></ul><ul><ul><li>Subsistence farms-limited technology </li></ul></ul><ul><ul><li>Rigid social structure </li></ul></ul><ul><ul><li>Resistance to change-transition triggered by external influence </li></ul></ul><ul><li>Second Stage-Preconditions for Take-Off </li></ul><ul><ul><li>Progressive Leadership-commercial exploitation of agriculture & extractive industries </li></ul></ul><ul><ul><li>Greater flexibility-installation of infrastructure-roads, railways, etc. </li></ul></ul><ul><ul><li>Greater openness to new technology </li></ul></ul><ul><ul><li>Greater Diversity of products produced </li></ul></ul>
  20. 23. Models of Development <ul><li>Third Stage-Take Off </li></ul><ul><ul><li>Experiences industrial growth </li></ul></ul><ul><ul><li>Urbanization </li></ul></ul><ul><ul><li>Industrialization, technology & mass production </li></ul></ul><ul><li>Drive to Maturity </li></ul><ul><ul><li>Diffusion of technology </li></ul></ul><ul><ul><li>Industrial specialization </li></ul></ul><ul><ul><li>International trade </li></ul></ul><ul><ul><li>Modernization at the core </li></ul></ul><ul><ul><li>Population growth is reduced </li></ul></ul><ul><li>Fifth Stage-Final Stage </li></ul><ul><ul><li>Mass consumption-widespread production of goods & services </li></ul></ul><ul><ul><li>High incomes </li></ul></ul><ul><ul><li>Majority of workforce in service sector </li></ul></ul>
  21. 24. Rostow’s Ladder of Development
  22. 25. Models of Development <ul><li>Structuralist Model this is the alternate to the Liberal Model that states disparities are inevitable due to structural features of the global economy. </li></ul><ul><li>These disparities can not be easily changed-it is misleading to assume that all areas will go through the same economic process of development </li></ul>
  23. 26. Models of Development <ul><li>Dependency Theory is another Structuralist Model </li></ul><ul><li>Political & economic relationships between nations & regions limit the development of the less well off areas </li></ul><ul><li>Colonial dependencies are still in place from long ago. </li></ul><ul><li>Dependency theory sees little hope for economic prosperity in some traditional parts of the world </li></ul>
  24. 27. Dependency Theory The political and economic relationships between countries and regions of the world control and limit the economic development possibilities of poorer areas. <ul><li>-- Economic structures make poorer countries dependent on wealthier countries. </li></ul><ul><li>- Little hope for economic prosperity in poorer countries. </li></ul>
  25. 28. Dependency Ratio by Country, 2005 A measure of the number of people under the age of 15 and over the age of 65 that depends on each working-age adult.
  26. 29. A Changing World <ul><li>Until 1980s there were 3 Blocs </li></ul><ul><ul><li>First World-The Capitalist West-the most advanced nations-democratic & capitalist </li></ul></ul><ul><ul><li>Second World-The Communist East of the Soviet Union & its Eastern European Satellites, Red China, N. Korea & Vietnam </li></ul></ul><ul><ul><li>Third World-non aligned nations with mixed economies and state control-now an obsolete term </li></ul></ul>
  27. 30. Three Tier Structure Core Processes that incorporate higher levels of education, higher salaries, and more technology * Generate more wealth in the world economy Semi-periphery Places where core and periphery processes are both occurring. Places that are exploited by the core but then exploit the periphery. * Serves as a buffer between core and periphery Periphery Processes that incorporate lower levels of education, lower salaries, and less technology * Generate less wealth in the world economy