Indicators of Economic Development

So Farrrr. We have written down terms connected with Development. Chosen 5 countries in each continent and produced a Choropleth map and described what it shows:

North South Divide Map

Definition of Development Changes Overtime. Early examples focused on strength of economies. First World (USA, Europe, Australasia) Second World (Former Communist) Third World (Africa, parts of Asia etc) These are all Out dated terms.

Definition Continued Many Geographers now link to Social Conditions and improvements in Human Welfare e.g. greater wealth, better education, health etc. Environmental issues are also important. E.g. Earth Summit, Rio de Janeiro 1992 examined the whole issue of Environmental Sustainability in relation to development.

Indicators of Economic Development

Growth versus Development Economic growth may be one aspect of economic development but is not the same Economic growth: A measure of the value of output of goods and services within a time period Economic Development: A measure of the welfare of humans in a society

Economic Growth Using measures of economic growth can give distorted pictures of the level of income in a country – the income distribution is not taken into account. A small proportion of the population can own a large amount of the wealth in a country. The level of human welfare for the majority could therefore be very limited. This might be a common picture…… Copyright: unseenob, http://www.sxc.hu But this could be just around the corner! Copyright: chinagrove, http://www.sxc.hu

Growth

Economic Growth Using measures of economic performance in terms of the value of income, expenditure and output GDP – Gross Domestic Product The value of output produced within a country during a time period GNP – Gross National Product The value of output produced within a country plus net property income from abroad (or income from foreign investments) GDP/GNP per head/per capita Takes account of the size of the population Real GDP/GNP Accounts for differences in price levels in different countries

Economic Growth Shopping Mall in Saudi Arabia Copyright : Christo Pacheco, http://www.sxc.hu Dubai Skyline Copyright: zchizzerz, http://www.sxc.hu High economic growth fuelled through capital spending can hide a number of underlying economic problems – how is the income and wealth distributed? Who is doing the spending and will it ‘trickle down’ to the poor?

GNP and GDP Task: Using page 7 of Pop, resources and Development, examine the strengths and weaknesses of using these two terms as measures of development. What is a better method but still using income.

National Income – Problems with using GDP/GNP Reliability of data? How accurate is the data that is collected? Distribution of income? How is the income distributed – does a small proportion of the population earn a high percentage of the income or is income more evenly spread? What is actually produced does not always have a monetary value e.g. subsistence farming.

National Income – Problems with using GDP/GNP Quality of life? Can changes in economic growth measure changes in the quality of life? Does additional earnings power bring with it additional stress, increases in working hours, increased health and family problems? Impact of exchange rate? Difference in exchange rates can distort the comparisons – need to express in one currency, but which one and at what value?

National Income – Problems with using GDP/GNP Black/informal economy? Some economic activity not recorded – subsistence farming and barter activity, for example Some economic activity is carried out illegally – building work ‘cash in hand’, drug dealing, etc. Work of the non-paid may not be considered but may contribute to welfare – charity work, housework, etc. Children in Sierra Leone dig for diamonds. This activity is illegal and goes unrecorded and is not therefore part of the national income but may be the only source of income for some of these children. Title: Sierra Leone Liberia. Copyright: Getty Images available from http://edina.ac.uk/eig

Development

Development Development incorporates the notion of a measure/measures of human welfare As such it is a normative(establishing a norm) concept – open to interpretation and subjectivity What should it include?

Social Indicators See Julius Neyere’s Definition, Write down and discuss View Table 1 on page 8 of P,R & D and list some social indicators of development.

Development Levels of poverty Inequality Absolute poverty Relative poverty Inequality Progress – what constitutes progress? Our definitions of progress may be highly subjective. What has progress brought to native tribes people across the globe? Title: Navajos refuse casino riches. Copyright: Getty Images, available from http://edina.ac.uk/eig

What is Poverty? Poverty is a ‘relative’ term Romanian gypsies – is this man living in poverty? Copyright: ghitulescu radu, http://www.sxc.hu Or is this villager in rural China? Copyright: Mark Forman, http://www.sxc.hu Poverty is a ‘relative’ term

Development Other considerations of human welfare: Political freedoms? Sustenance? Sustainable development? Self esteem? Proportion of activity in different sectors of the economy: Primary Secondary Tertiary

Development Iraqis have supposedly been given their freedom following the American led ‘Operation freedom’ but has it improved welfare? Image title: Army watches burning oil. Copyright: Getty Images, available from http://edina.ac.uk/eig

Human Development Index

Human Development Index (HDI) HDI – A socio-economic measure Focus on three dimensions of human welfare: Longevity – Life expectancy Knowledge – Access to education, literacy rates Standard of living – GDP per capita: Purchasing Power Parity (PPP)

Other Measures?

Other Measures? How far do these other measures reflect levels of human welfare? America may be the richest nation on earth but it has its problems – does this reflect the level of development? Title: Yetunde Price shot and killed in Compton. Copyright: Getty Images, available from http://edina.ac.uk/eig

Tasks: Write your own definition of development. Complete the tasks on page 11 of the booklets Define New Human Poverty Index Evaluate the usefulness of the HDI as an Indicator for measuring development. (See page 14 in booklet for calculation) Read and Highlight the Geoactive pages 16-19 and add additional information to notes and answer question 3.

Tasks Continued Construct a table for the development profiles of 5 countries (See page 1 of booklet) Describe what the table shows regarding the levels of development of each of the countries.