The document discusses the key concepts of economics and development economics. It explains that economics originated from the Greek words for household management, referring to managing limited resources to meet unlimited wants. Development economics focuses on improving developing country economies through factors like health, education, and domestic/international policies. It also discusses different perspectives on development goals and indicators used to measure and compare development levels between countries like per capita income, education, and health metrics.

1. Compiled By :Dr. R. Ezhilraman, PGT (Geo)
Jawahar Navodaya Vidyalaya, Lepakshi, A.P.

2.  The Term ‘Economics’ is derived from two Greek
words :-
 (i) Okios: – a household and (ii) Nemein ( nomos)-
Management.
 Economics means ‘Home Management’. The head of a
family faces the problem of managing the unlimited
wants of the family members within the limited
income of the family. In fact, the same is true for a
society also. The society also faces the problem of
tackling unlimited wants of the members of the
society with the limited resources available in that
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Adam smith was the Father of Economics

3. Development: The
ideas of development
or progress have
always been with us.
We have aspirations
or desires about
what we would like
to do and how we
would like to live.
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4.  A branch of economics that focuses on improving
the economies of developing countries.
 Development economics considers how to
promote economic growth in such countries by
improving factors like health, education, working
conditions, domestic and international policies
and market conditions.
 It examines both macro-economic and micro-
economic factors relating to the structure of a
developing economy and how that economy can
create effective domestic and international
growth.
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5.  Different persons can have different
developmental goals.
 What may be development for one may not be
development for the other.
 It may even be destructive for the other.
 Different people have different developmental
needs. These needs are based on their
particular life situations.
 This creates a need for a development goal
which can encompass different needs of
different people in a fair way.
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6. 4/19/2016Dr.R.Ezhilraman, PGT Social Science, JNV Lepakshi 6
Category of Persons Development Goals /Aspiration
(i) Landless Rural
labourer
1. More days of work; 2. Better wages;
3. Economic and social equality; 4.
Local school is able to provide
education for their children
(ii)..Prosperous
Farmer
Assured a high family income through
higher support prices for their crops
(iii) Rich person
1) Higher family income 2) Better
education to their children 3) To settle
their children in abroad
(iv) A girl from rich
urban family
She get as much freedom as her
brother and is able to decide what she
wants to do in life

7.  It is very important to keep in
mind that different persons could
have different as well as
conflicting notions of a country’s
development.
 All round development of a nation
may cause by setting up of heavy
industries, developing education,
health and national income
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8.  National Income: It refers to the market values
of all good and services which produce in
financial year within the country
 Average income / per capita income (PCI): it is
the ratio of total national income of a country
with respect to total population
 PCI = Total income of the Country
Total population of the Country
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9.  World bank has used the criterion of per capita
income for classifying into high income and
low-income countries.
 According to the 2012 World Development
Report:-
a) US$12616 per annum and above in 2012 are
called rich countries.
b) countries with a PCI of US$1035 or less per
annum in 2012
c) In the year 2012, India’s PCI was just US$ 1530
per year.
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10.  Human Development Report (HDR) published by United Nations
Development Program (UNDP) compares countries based on
educational level of the people, their health status and PCI.
 The Basic Human development indicators are:
I. Per Capita Income: The total income of a country divided by the
population is called the per capita income of that country.
II. Gross National Product: The total income generated in the country is
called Gross National Product.
III. Gross Domestic Product: The total income generated minus the
income generated by exports is called the Gross Domestic Product.
IV. Infant Mortality Rate: The number of children who die before
completing one year out of 1000 births is called the infant mortality
rate. The lesser figure is a better indicator of development. This is
an important parameter as it shows the quality and extent of
availability of healthcare in a country.
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11.  The Basic Human development indicators are: (cont…)
V. Male to Female Sex Ratio: Number of female per thousand male is
called sex ratio. A lesser figure shows society’s aversion to a girl child
and worse condition of women in society.
VI. Life expectancy: The maximum age up to which an adult lives is
called the life expectancy rate. This also shows the overall quality of
life in a country.
VII. (vii) Literacy Rate: It measures the proportion of literate population in
the 7 and above age group. The percentage of literate people is
another important indicator of development. Education is a big level
as it opens newer job opportunities for the educated persons.
VIII. (viii) Net Attendance Ratio: it is the total number of children of age
group 6-10 attending school as a percentage of total number of
children in the same age group.
IX. (ix) Infrastructure: Roads, railways, airports, ports and power
generation are the lifelines of a nation’s economy. A better
infrastructure ensures a better economic activity leading to overall
prosperity.
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12.  Money in your pocket cannot buy all the goods and
services that you may need to live well.
 Your money cannot buy you a pollution-free
environment.
 Money may not protect you from infectious diseases,
until your community takes preventive steps.
 Therefore public facilities like education, sanitation,
peaceful-green and clean environment are more
necessary.
 Even Government opened many schools and provides
other facilities, in many areas, children, particularly
girls are not able to achieve secondary level
schooling, because of less facilities.
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13. 4/19/2016Dr.R.Ezhilraman, PGT Social Science, JNV Lepakshi 13
 The above mentioned list is not all inclusive
but they are more important than other goals
which are not mentioned here.
 Every goal or parameter of development is
interrelated.
 Each goal influences the other and creates an
opportunity for development in a fair way.

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 Comparison of countries are particularly
based on their income i.e., it is the basic
attribute of comparison.
 Countries with higher income are more
developed than those with less income.
 Here more income means more of things
available that human need.

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Country
PCI in
US$
Life
Expectancy at
Birth
Literac
y Rate
Gross Enrolment
Ratio for all Level
HDI Rank
Norway 38550 80 --- 97 1
China 5530 71 91 73 81
Sri
Lanka
4390 74 91 69 93
India 3139 64 61 60 126
Pakistan 2225 63 50 35 134

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No. Country PCI in US$
1 Luxembourg 1,08,832
2 Norway 84,444
3 Qatar 76,168
4 Switzerland 67,246
5 United Arab Emirates 59,717
6 Denmark 56,147
7 Australia 55,590
8 Sweden 48,875
9 United States 47,284
10 Netherlands 47,172

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No. Country PCI in US$
1 Monaco 1,86,175
2 Liechtenstein 1,34,392
3 Luxembourg 1,05,044
4 Bermuda 88,747
5 Norway 79,089
6 Qatar 69,754
7 Switzerland 63,629
8 Denmark 55,992
9 Ireland 51,049
10 United Arab Emirates 50,070
11 Netherlands 47,917

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 Here is the answer, to find the income we take the
average income which is the total income of the
country and it is divided by the country’s population.
The average income is also called as per capita income.
 Example: Let us take two countries A & B. suppose
population of these countries is 5 person each
Monthly
income of
citizens
1 2 3 4 5 Average
Country A 9500 10500 9800 1000 10200 8200
Country B 500 500 500 500 48000 10000
Therefore we can conclude that country B is more developed that country A

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 To find the developed state except income other
criteria's are also kept in mind. Let us take the
example of three states Maharashtra, Kerala and Bihar
After studying the table we can conclude that Kerala is the
developed state among these three and Bihar is least developed
amongst them.
State
Infant mortality
rate Per 1000
(2012)
Literacy rate %
(2011)
Net attendance ratio (per
100 persons) secondary
stage (age 14 & 15 years)
2009-10
Maharashtra 25 82 64
Kerala 12 94 78
Bihar 43 62 35

20.  The word sustainable means something which
is not short lived but can continue in future
also.
 It is a development strategy that manages all
natural resources and human resources as well
as financial and physical assets for increasing
long term wealth and well being.
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21.  Sustained rise in the
real PCI and quality of
life.
 Reduction in pollution.
 Rational use of natural
resources.
 To fulfils the
requirements of future
generations.
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22.  The economy of India is the tenth-largest in the world by
nominal GDP and the third-largest by purchasing power parity
(PPP)
 On a per-capita-income basis, India ranked 141st by nominal
GDP and 130th by GDP (PPP) in 2012, according to the IMF.
 India's GDP grew by 9.3% in 2010–11.
 GDP growth rose marginally to 4.8% during the quarter through
March 2013, from about 4.7% in the previous quarter.
 GDP growth rose marginally to 4.8% during the quarter through
March 2013, from about 4.7% in the previous quarter.
 The government has forecast a growth rate of 6.1%-6.7% for the
year 2013–14, whilst the RBI expects the same to be at 5.7%
 Sectoral Composition of GDP (2012) is: in Agricultural Sector -
17.40%; in Industrial Sector – 24.80%; in Service Sector – 56.90%
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23.  India ranks second worldwide in farm output.
 Agriculture and allied sectors accounted for 17.40% in 2012 GDP.
 The economic contribution of agriculture to India's GDP is steadily
declining with the country's broad-based economic growth.
 Still, agriculture plays a significant role in the overall socio-economic
fabric of India.
 Problems Faced by Agricultural Sectors: Poor Condition of Roads,
which causes untimely transport of goods; It increases the gap
between demand and supply; and also it Increases transport cost
 Lacks Storage Facility: It Causes spoilage of 30% of farmers produce;
and it Forces farmers to sell at lesser prices.
 Unorganised Retail: Farmers gets just 10 to 30% of price; While farmers
from USA and Europe gets 60 to 81; It is assumed that India's 90% of retail market
is unorganized
 Poor Irrigation System: It causes crop failures in some parts of country;
Delays in crop; Heavy loss to farmers.
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24.  Industry accounts for 28.80% of GDP and employs 22%
of the total workforce.
 India is 11th in the world in terms of nominal factory
output.
 Textile industry is the 2nd largest source of employment
after agriculture, providing employment to over 20
million people.
 Retail Market is the Fastest emerging market. It
contributes 14% to 15% in GDP and It’s growth
estimated to be $450 billion
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25.  India is 13th place in services output.
 The services sector provides employment to 27%
 Information technology contributing to 25% of the
country's total exports in 2007–08.
 7 Indian firms among top 15 IT outsourcing company.
 Business process outsourcing (BPO) Contributes 1% of
GDP; Employing 2.1 million people with an Annual
revenue of 11 Million $.
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26.  Service sector is largest contributor in GDP of India.
 IT and BPO are major contributor in service sector.
 Agricultural sector is having significant contribution in
country's economy, and contribution can be increased
by solving problems like condition of roads and proper
storage facility.
 Industrial sector is contributing less than its
capabilities and it can be increased by setting
manufacturing industries for sustainable economic
development.
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27. The END
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Thanks for Watching
Wish you all best for your
‘All-Round’ Development
Yours ….
Dr. R.Ezhilraman, M.A., M.Phil, Ph.D., B.Ed., BLIS, DPCS,
PGT-Social Science, JNV Lepakshi