1. WHY DO SOME COUNTRIES DEVELOP? WHY DON’T OTHERS?

2. WHAT IS DEVELOPMENT?
One definition: “The increasing capacity to make rational use of natural and human resources for social ends.”
Is development an absolute or relative concept? Is development linear or exponential?
Is development just about economics or something bigger? Economics is not just about having more resources. It’s tied to:
The idea of progress over time
Transformed gender and relations
Secularism and science

3. Why should we care anyway?

4. HOW DO WE MEASURE DEVELOPMENT?
Measurement issues:
Population and development
PPP vs. GNP vs. GDP
Measurements within countries:
Inequality: Comparing income at percentiles and GINI index measures
Absolute poverty. Presently defined as living on <$1.90 a day at 2011 PPP. In 1990, this was 35% of all people on the planet. Today: 9%

5. SOME DATA ON HOW THINGS ARE CHANGING

8. Inequality is growing at the global level

9. But the typical person is better off (ignore y axis)

10. WHO IS GROWING? WHO IS NOT? (AND WHAT THAT CAN TELL US)
The “bottom billion”:
Mostly African (70%)
The key variables: (1) Recent or ongoing civil war, (2) landlocked, (3) the resource curse (4) high populations of young men (5) conflictual ethnic groups, (5) bad governance
The titans (BRIC): Brazil, Russia, China, & India (mostly just the last two).
China is key. 1990, 2/3 of all Chinese lived on <$1.90 a day. Today: 2%.
Let’s look at some data…

11. SOME MORE DATA…

12. SOME MORE DATA…

13. BUT THE DEVELOPED WORLD IS NOT DOWN FOR THE COUNT…

14. SOME MORE DATA…

15. WHAT DO POOR COUNTRIES NEED TO DEVELOP?
Is under-development do to a lack of capital and different timelines?
W.W. Rostow’s proposed “modernization theory” as a “a non- Communist Manifesto”
What are the stages of development? And why is growth exponential instead of linear?
Why should poor countries with access to capital get richer more quickly (the catch up thesis)?
The bottom line: higher rich-poor gaps are natural, temporary, and show that things are improving
Three approaches to fixing poverty from this perspective:
Increase international development aid and knowledge transfer (e.g., World Bank Programs); microloans
Use state capitalism to focus investment and build internal know-how
Increased access to global markets and investment.

16. `
Is underdevelopment is caused by the First World and can’t be solved by developing states?
The legacies of colonialism
World system theory: the core and the periphery
Purposeful underdevelopment: enclave economies, domestic elites, and international debt
The IMF, World Bank, and WTO as agents of capitalism and the AIDs
Can states break out of the system?
The old approach: import-substitution industrialization and protectionism? Brazil, Mexico, and India as examples
Today’s approach: Export-oriented industrialization… Strong state involvement early on to make industries internationally competitive; strong support for trade with advanced economies.

17. Why might culture explain underdevelopment?
Max Weber’s argument: Religion = science & capitalism
The Protestant work ethic
Scientific rationalism
Individualism
Meritocracy
Modern versions of cultural explanations for underdevelopment:
Openness to clientelism/patronage networks, nepotism
Openness to corruption: Lootable assets, rent seeking, “Kleptocracies,” tax evasion and social investment
Old solutions to poverty: “White man’s burden” and genocide; foreign occupation/colonialism, evangelical movements, divide and conquer with “good” groups; train the elite/trainable
Today’s solutions: Democratization, globalization & trade; building state capacity, cultural exchange programs; investment in “soft power,” empowering women, increasing education, humanitarian intervention

18. Is underdevelopment mostly the product of weak/interventionist states and bad governments?
Structural adjustment programs: Economic freedom, trade, & comparative adv.
State building programs: Dealing with weak, multi-national, & undemocratic states
Solu8tions from this perspective?
The WTO and global trade are good
The IMF and the Washington Consensus are helpful
By-passing the state with micro-finance and globalization