Transcript CH 1
Chapter 1: Outline 1. Three Vignettes (3 contrasting stories about livelihood change in …. A. Malaysia B. Ethiopia C. Ukraine D. Development & Globalization 1 2. Rich and Poor Countries: There is more between rich & poor Learn Terminology abut different stages of County level of development based on Income Developed vs developing or less developed (LDCs), Low income Countries (LICs), lower middle income (LMIC), upper middle income (UMIC), high income (HIC), newly industrialized or OECD countries, third world, North vs South. 2 3. Growth and Development Growth is not the same as Development • Development = Economic Growth + structural change involving participation of people in the economy. A Key feature of economic growth is that modern economic Growth that involves the application of Science and Technology for human progress (Simon Kuznets view) 3 4. A Development Continuium Developing country covers a diverse group of African and other developing economies in Asia, Latin America, Caribbean, etc... • Income per capital is a key indicator of development but, limited. One limitation is the international comparison requires converting country currency into a common currency • A more accurate method is Purchasing Power Parity compared to using simple exchange rates conversion. 4 Other methods include using physical measures of wellbeing such as Energy Use, life Expectancy, Adult Literacy, Proportion of rural population, etc. See Figures 1.1 to 1.4 carefully 5 6 7 8 9 5. A Glance at History A. Multiple Paths to Development across the World nations based on different historical & colonial experiences for Africa, Latin America, & Asia. HW1: Colonialism and development. B. Diversity in Development Achievements But, there is also common features or goals of desire for education, developed institutions, self-government, cultural identity & pride (what we called such factors?), etc 10 Approaches to Development Development is a complex and multi-dimensional process that can be understood by combining the understanding of economics, empirical analysis, and institutions and politics as well as culture Development is foremost a process about people involving mobilization of inputs, the role of trade, sectors including the role of government in human development. It is multi-disciplinary. 11 Country Studies Look up selected African countries in annual publications such as the World Development Report (World Bank) & Human Development Report ( UNDP) 12 Identification & Paired-Concepts Note: Explain the meaning and the relationships, if any Economic Growth & Economic Development Modern Economic Growth & Modernization North & South GDP and per capita income World Bank , OECD Industrialization, Urbanization Substitutes, LDCS Institutions, Economic Development 13 Malaysia Population: 28+ m Malaysia is a relatively open sate-oriented and newly newly industrialized market economy. The state plays a significant but declining role in guiding economic activity through macroeconomic plans. One of the best economic records in Asia, with GDP growing an average 6.5% annually from 1957 to 2005. In 2011 the GDP (PPP) was about $450 billion, the 3rd largest economy in ASEAN and 29th largest in the world. 14 Kenya Pop.: 41+ m. Is the biggest and most advanced economy in east and central Africa Kenya is still a poor developing country with a (HDI) of 0.509, putting the country at position 143 out of 185 Half of Kenyans live in absolute poverty. The important agricultural sector is one of the least developed and largely inefficient, employing 75% of the workforce compared to less than 3 percent in the food secure developed countries. 15 Nigeria Pop. 162+ m. With its abundant supply of natural resources, well-developed financial, legal, communications, transport sectors and stock exchange (2nd largest in Africa). Nigeria is ranked 31st in the world in terms of GDP (PPP) as of 2011. The United States is the country's largest foreign investor. HW#2: What about oil exports to USA? The IMF projected economic growth of 9% in 2008 and 8.3% in 2009. The IMF projects a 8% growth in the Nigerian economy in 2011. 16 Ethiopia Pop. 84+ m. IMF: one of the fastest growing economies in the world, registering over 10% economic growth from 2004 through 2009. It was the fastest-growing non-oil-dependent African economy in the years 2007 and 2008. Growth has decelerated moderately in 2012 to 7% and is projected to be 6.5% in the future During 2008 and 2011: high inflation and a difficult balance of payments situation. Inflation surged to 40% in August 2011 GDP per capita is one of the lowest in the world 17 For more info: • • • African Development Bank Group: http://www.afdb.org/en/ WB: Country Overview: http://www.worldbank.org/en/country/malaysia/overview For Data and Stat.: Index Mundi: http://www.indexmundi.com/ 18