There are differing levels of economic development between countries. Wealthier countries with high standards of living are called more economically developed countries, while poorer countries with low standards are called less economically developed countries. Countries can be compared using gross national product per capita in US dollars, but this only provides an average and may not accurately capture living conditions. To better understand relative wealth, additional statistics on population, social factors like healthcare and education, and economic data should be considered. The wealth gap exists because less developed countries often have low industrialization, rely on agriculture and mining, cannot afford imports, lack infrastructure and power, face political instability or natural disasters, and have less education.

1. Managing economic development Contrasting levels of development How can development be measured?

2. What is development? Development involved improving a country’s economy and raising its standards of living. Wealthier countries with high standards of living are often called ‘more economically developed countries’ (MEDCs) Poorer countries with generally low standards of living are often called ‘less economically developed countries’ (LEDCs) There are enormous differences in countries in terms of wealth, these are often related to levels of development.

3. How can countries be compared? Problems GNP is an average and there may be big differences within the country. GNP figures may not be accurate. It does not say much about general living conditions. GNP Countries are often compared by using the Gross National Product (GNP) per capita (person). This is the value of all goods and services in a country divided by its population. The figure is given in US dollars (US$). What other information can be used to compare countries?

4. How can countries be compared? To get a more complete picture of relative wealth a range of other statistics can be used Population data (life expectancy/ infant mortality) Social data (healthcare/education/levels of services) Economic data (income/employment structure/energy use)

5. Why does a wealth gap exist? Low levels of industrial development Over reliance of agriculture/mining Lack of power supplies Countries cannot afford to import goods Poor roads and other communication networks Political instability of war Lack of power supplies Natural disasters – earthquakes and floods Lack of education and training Why does a wealth Gap exist? The North/ South Divide