DevelopmentDevelopment

Agglomeration economies Agglomeration economies

• The term economies of The term economies of agglomeration is used in urban agglomeration is used in urban economics to describe the benefits economics to describe the benefits that firms obtain when locating near that firms obtain when locating near each other ('agglomerating'). This each other ('agglomerating'). This concept relates to the idea of concept relates to the idea of economies of scale and network economies of scale and network effects. effects.

Human Development Human Development Index(HDI)Index(HDI)

• An indicator of the level of An indicator of the level of development for each country development for each country constructed by the united nations, constructed by the united nations, combining income, literacy, combining income, literacy, education, and life expectancy.education, and life expectancy.

Primary SectorPrimary Sector

• The sector of an economy making The sector of an economy making direct use of natural resourcesdirect use of natural resources

• Sectors that produce or obtain raw Sectors that produce or obtain raw materials or natural productsmaterials or natural products

• Industries engaged in extraction of Industries engaged in extraction of natural resources natural resources

Quaternary sectorQuaternary sector

• The portion of an economy that is The portion of an economy that is based of knowledge applicable to based of knowledge applicable to some business activity that usually some business activity that usually involves the provision of services.involves the provision of services.

NeocolonialismNeocolonialism

The major world powers control the The major world powers control the economies of the poorer countries, economies of the poorer countries, even though the poorer countries are even though the poorer countries are now politically independent states. now politically independent states.

ProductivityProductivity

• The value of a particular product The value of a particular product compared to the amount of labor compared to the amount of labor needed to make it.needed to make it.

Value AddedValue Added

• Difference between the total sales Difference between the total sales revenue of an industry and the total revenue of an industry and the total cost of components, materials, and cost of components, materials, and services.services.

HDIHDI

• Human Development IndexHuman Development Index

• Created by the United Nations, and Created by the United Nations, and recognizes that a country’s recognizes that a country’s development level is a function of all development level is a function of all three factors (economic, social, and three factors (economic, social, and demographic.)demographic.)

MDCMDC

• More developed countryMore developed country

• A country that has progressed A country that has progressed relatively far along a continuum of relatively far along a continuum of developmentdevelopment

Trickle-down TheoryTrickle-down Theory

• An economic theory of monetary An economic theory of monetary benefits directed by the government benefits directed by the government to big businesses that will in turn, to big businesses that will in turn, pass down to and profit, smaller pass down to and profit, smaller businesses and the general public.businesses and the general public.

Comparative AdvantageComparative Advantage

• The principle that an area produces The principle that an area produces the items for which it has the the items for which it has the greatest ratio of disadvantage in greatest ratio of disadvantage in comparison to other areas, assuming comparison to other areas, assuming free trade exists.free trade exists.

Tertiary SectorTertiary Sector

• The portion of the economy The portion of the economy concerned with transportation, concerned with transportation, communication, and utilities, communication, and utilities, sometimes extended to the provision sometimes extended to the provision of all goods and services to people in of all goods and services to people in change for payment. change for payment. I bet coach I bet coach Woerner can’t tell what Woerner can’t tell what colorcolor this is!!! this is!!! HAHAHA he is bald!!!!!HAHAHA he is bald!!!!!

SUSTAINABLE SUSTAINABLE DEVELOPMENTDEVELOPMENT

• The level of development that can be The level of development that can be maintained in a country without maintained in a country without depleting resources to the extent depleting resources to the extent that future generations will be unable that future generations will be unable to achieve a comparable level of to achieve a comparable level of development.development.

Economic indicatorEconomic indicator

• Any economic statistic such as Any economic statistic such as unemployment rate GDP or the unemployment rate GDP or the inflation rateinflation rate

Basic IndustriesBasic Industries

• Industries that sell their products or Industries that sell their products or services primarily to consumers services primarily to consumers outside the settlementoutside the settlement

• Ex. Agriculture, Chemicals, Steel, Ex. Agriculture, Chemicals, Steel, Metal, Manufacturing, etc.Metal, Manufacturing, etc.

Non-Basic IndustriesNon-Basic Industries

• Industries that sell their products Industries that sell their products primarily to consumers in their primarily to consumers in their community; small businesses that community; small businesses that sell to local customerssell to local customers

• Ex. Diners, service companies, Ex. Diners, service companies, Convenience stores, drug dealers, Convenience stores, drug dealers, etc.etc.

Comparative AdvantageComparative Advantage

• Concept in economics that a country Concept in economics that a country should specialize in producing and should specialize in producing and exporting only those goods and exporting only those goods and services which it can produce more services which it can produce more efficiently than other goods and efficiently than other goods and servicesservices

Gross National Product Gross National Product

• Total market value of all goods and Total market value of all goods and services produced by a nation during services produced by a nation during a specific period.a specific period.

• John Mark FriendJohn Mark Friend

LDCLDC

• Less Developed Country classified by Less Developed Country classified by per capita income, literacy rates, per capita income, literacy rates, T.V.s per capita, and hospital beds T.V.s per capita, and hospital beds per capita.per capita.

• Ex: Middle East, South Asia, East Ex: Middle East, South Asia, East Asia, Latin America, Southeast Asia, Asia, Latin America, Southeast Asia, and Central Asia.and Central Asia.

Brandt LineBrandt Line

• Line that divides the MDCs and the Line that divides the MDCs and the LDCsLDCs

Economic DevelopmentEconomic Development

• Sustained, concentrated actions of Sustained, concentrated actions of policy makers and communities that policy makers and communities that promote the standard of living and promote the standard of living and economic health of a specific area economic health of a specific area

Productivity Productivity

• The value of a particular product The value of a particular product compared to the amount of labor compared to the amount of labor needed to make it.needed to make it.

Market orientationMarket orientation

• Tendency of an economic activity to Tendency of an economic activity to locate close to its market; reflection locate close to its market; reflection of large and variable distribution of large and variable distribution costs.costs.

Raw Material OrientationRaw Material Orientation

• The tendency of an economic activity The tendency of an economic activity to locate near its raw material to locate near its raw material source.source.

Regional multiplierRegional multiplier

• Economic growth caused by Economic growth caused by economic growth.economic growth.

• EX: The discovery o steel leads to a EX: The discovery o steel leads to a steel manufacturing business.steel manufacturing business.

Quaternary SectorQuaternary Sector

• Part of the economy. Consists of Part of the economy. Consists of intellectual activities like government, intellectual activities like government, culture, libraries, and scientific research. culture, libraries, and scientific research.

• - Jordan- Jordan

Primary SectorPrimary Sector

• The portion of the economy The portion of the economy concerned with the direct extraction concerned with the direct extraction of materials from Earth’s surface, of materials from Earth’s surface, generally through agriculture, generally through agriculture, although sometimes through mining, although sometimes through mining, fishing, and forestry.fishing, and forestry.

Subsistent EconomySubsistent Economy

An economy which refers simply to the An economy which refers simply to the gathering or amassment of object gathering or amassment of object value, the increase in wealth, or value, the increase in wealth, or creation of wealth; focus on a creation of wealth; focus on a ‘natural’ way of living.‘natural’ way of living.

Literacy RateLiteracy Rate

• The percentage of a country’s people who The percentage of a country’s people who can read and writecan read and write

• Literacy rate is usually higher in MDC’s Literacy rate is usually higher in MDC’s usually in 90%usually in 90%

• Affects the health, population, life Affects the health, population, life expectancy, infant mortality rate, natural expectancy, infant mortality rate, natural increase rate, and crude birth rate.increase rate, and crude birth rate.

• All these affect the development All these affect the development

Import SubstitutionImport Substitution

A government strategy that A government strategy that replaces some imports to replaces some imports to

encourage local production of those encourage local production of those products to generate employment.products to generate employment.

Secondary SectorSecondary Sector

The portion of the economy The portion of the economy concerned with manufacturing concerned with manufacturing useful products through useful products through processing, transforming, and processing, transforming, and assembling raw materials.assembling raw materials.

Economic IndicatorsEconomic Indicators

• A piece of economic data of macroeconomic A piece of economic data of macroeconomic scale, that is used by investors to interpret scale, that is used by investors to interpret current or future investments possibilities current or future investments possibilities and judge the overall health of an economy. and judge the overall health of an economy. Economic indicators can potentially be Economic indicators can potentially be anything the investor chooses, but specific anything the investor chooses, but specific pieces of data released by government and pieces of data released by government and non-profit organizations have become non-profit organizations have become widely followed.widely followed.

• Ex: unemployment, consumer price index, Ex: unemployment, consumer price index, bankruptcies, price of crude oilbankruptcies, price of crude oil

Brandt LineBrandt Line

• A line depicting the North-South A line depicting the North-South divide between the developed divide between the developed countries and the less developed countries and the less developed countries. Created by West Germany countries. Created by West Germany Chancellor Willy Brandt in 1980.Chancellor Willy Brandt in 1980.

Market-OrientationMarket-Orientation

• The tendency of an economic activity The tendency of an economic activity to locate close to its market; a to locate close to its market; a reflection of large and variable reflection of large and variable distribution costs distribution costs

NeocolonialismNeocolonialism

• A disparaging reference to economic A disparaging reference to economic and political policies by which major and political policies by which major developed countries are seen to developed countries are seen to retain or extend influence over the retain or extend influence over the economies of LDC’s and peopleseconomies of LDC’s and peoples

• Control by a powerful country of its Control by a powerful country of its former colonies (or other LDC’s) by former colonies (or other LDC’s) by economic pressureseconomic pressures

Import SubstitutionImport Substitution

• The process by which domestic The process by which domestic producers provide goods or services producers provide goods or services that formerly were bought from that formerly were bought from foreign producers.foreign producers.

Developing CountryDeveloping Country

• A country that has made some A country that has made some progress and expects to continue progress and expects to continue improving the material conditions of improving the material conditions of people, through knowledge and people, through knowledge and technologytechnology

Literacy RateLiteracy Rate

• The percentage of a country's people The percentage of a country's people who can read and write.who can read and write.

• Exceeds 98% in MDCs in contrast Exceeds 98% in MDCs in contrast with less than 60% in LDCs.with less than 60% in LDCs.

Less Developed CountryLess Developed Country

• A country relatively early stage in the A country relatively early stage in the process of economic development.process of economic development.

DEPENDENCY THEORYDEPENDENCY THEORY

• 1. IS A BODY OF SOCIAL SCIENCE 1. IS A BODY OF SOCIAL SCIENCE THEORIES PREDICATED ON THE THEORIES PREDICATED ON THE NOTION THAT RESOURCES FLOW NOTION THAT RESOURCES FLOW FROM A “PERIPHARY” OF POOR AND FROM A “PERIPHARY” OF POOR AND UNDERDEVELOPED STATES TO A UNDERDEVELOPED STATES TO A “CORE” OF WEALTHY STATES, “CORE” OF WEALTHY STATES, ENRICHING THE LATTER AT THE ENRICHING THE LATTER AT THE EXPENSE OF THE FORMER.EXPENSE OF THE FORMER.

Developing CountryDeveloping Country

• A more politically correct term used A more politically correct term used in place of LDC or third world country.in place of LDC or third world country.

Rostow’s Modernization Rostow’s Modernization Model Model • A five stage model of development developed by A five stage model of development developed by

W.W. Rostow.W.W. Rostow.

• Traditional society- Not yet started developmentTraditional society- Not yet started development

• The preconditions for take off- starts to invest in The preconditions for take off- starts to invest in new technologies.new technologies.

• The take off- Rapid growth, and areas of the The take off- Rapid growth, and areas of the economy start to be productiveeconomy start to be productive

• The drive to maturity- Workers become skilled The drive to maturity- Workers become skilled and specialized, and specialized,