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25 Cards in this Set
- Front
- Back
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Measurements of Development |
GDP, GNP, Pre Capita |
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Problems with GNP |
Ignores inequality, Non-marketability, Does not account for biases in the market, Quality of life, Sustainability and environmental degradation |
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GNH |
Gross National Happiness-Sustainable and equitable socioeconomic development, environmental conservation, cultural preservation and promotion, and good governance. |
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Physical Quality of Life Index |
3 Indicators: Life expectancy at age 1, infant mortality rates, and literacy rates (being able to read a newspaper). Index ranges from 1-100, 100 being the best. |
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SEN's Capability Approach |
"The freedom that a person has in terms of the choice of functions, given his/her personal features (conversion of characteristics into functionings) and his/her command over commodites (freedom to achieve various lifestyles). |
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Importance of SEN's Capability Approach |
Development=> Freedom of choice over functionings, enhancing capabilities and freedoms, removing any 'unfreedoms' such as famine, poor health, lack of political liberty and civil rights, and economics security. |
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HDI |
Human Development index: Ranks countries between 0 and 1. 3 Goals: Longevity measured by life expectancy at birth, Knowledge measures by weighted average of adult literacy (2/3) and mean years of schooling (1/3), Standard of Living measured by real per capita income adjusted for different purchasing power. |
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Problems with HDI |
Gross enrollment vs. net enrollment. Equal weights. Quality-extra year life w/o morbidity. 2010 UNDP has started using geometric weights. Uses GNP per capita rather than GDP per capita. New Education index-average years of schooling & expected educational attainment. |
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Washington Consensus |
Stabilize, Liberalize, & Privatize: Government should exercise fiscal discipline, obviating needs for inflation taxes. Public expenditure priorities should be shifted from politically sensitive areas to neglected fields with high economic returns and potential to improve income distribution. |
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Low Income Countries Classification |
Low income countries have a per capita GNP of less than $1,035 or less (2013). |
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Lower Middle Income Countries Classification |
Lower middle income countries have a per capita GNP between $1,036 to $4,085 |
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Upper Middle Income Countries Classification |
Upper middle income countries have a per capita GNP between $4,085 to $12,615 |
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High Income Countries Classification |
High income countries have a per capita GNP in excess of $12,616, which includes Kuwait and the UAE. |
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Natural Resource Curse |
Dutch Disease: Which is a term that describes the dutch's issues in international trade in which their only main exports were of a single good. Can influence corruption and false government. |
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Ethnic Diversity |
40% of the World's Nations have more than five significant ethnic populations. Ethnic diversity means internal strife and instability (ex. Sri Lanka, Rwanda, Sierra Leon, Yugoslavia, Somalia. |
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Ethnic Conflicts in Africa |
High prevalence of Civil War, Increased prevalence in the last two decades especially, Wars were relatively short yet tended to be the most bloody, Low levels of democracy, and the increase in likelihood with global warming effects. |
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Causes of Civil War in Africa |
Low and slow growth, Dependence on primary commodities such as exports, Grievances |
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Costs of Civil War in Africa |
Reduction of growth by 2.3 percent a year, Disease caused by migration, and Trans boundary effects. |
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International Poverty Line |
Was $1 a day, but has increased to $1.25 a day due to inflation. Based on a compilation of 15 of the poorest countries GDP and GNP's as well as countries CPI (Consumer Price Index, which accounts for a households daily bundle of goods) |
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Common Features of Developing Countries |
Low Standard of Living, Low Productivity and lack of Physical and Human Capital, Backward Technology, High population Growth, Unemployment & Underemployment, Dependence on agriculture & Primary Exports |
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Linear-Stages Theory (50's & 60's) |
Rostow's Stages of Growth; Transition from under development to development in terms of stages |
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Harrod-Domar Model |
Capital and Savings; Capital-output ratio; amount of capital necessary to produce one unit of output. Assumptions; c is fixed and exogenous, savings ratio,s, is a fixed proportion of national output. In order for a country to grow, they have to save a proportion of their GNP |
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Harrod-Domar Model assumptions |
S=sY, I=^K, K/Y=c, ^K/^Y=c, ^K=c^Y, S=I, S=sY=c^Y=I, sY=c^Y or ^Y/Y=s/c |
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Criticisms of Harrod-Domar Model |
Savings and investment is a necessary but not sufficient condition for growth. Does not meet the pre-conditions for successful utilization of foreign aid. |
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b |
b |
