R I C H A N D P O O R

Economic and Social Inequalities (Unit 12)

  Rich, developed north   Poor, underdeveloped south – “the global south”

Characteristics of Rich Countries

  Developed   Industrial   Northern hemisphere   High productivity   Stable political systems;

democratic traditions   High level of education   Little reliance on other

countries   Independent foreign

policy

Characteristics of Poor Countries

  Less developed   Agricultural   Southern hemisphere   Low level of productivity   Unstable political systems   Reliance on agriculture and

primary resource exports   Imperfect markets (corruption)   Dependence & vulnerability in international

relations

Theories Explaining Inequalities

  High demographic growth   Decolonization   Globalization

Theory 1: High Demographic Growth

  High birth rate   Children needed to work and help support families   Many children die at young ages

  Low life expectancy   Poor sanitation   Diseases spread quickly   Lack of medical resources

Theory 2: Decolonization

  Countries that became independent after decolonization did not become economically independent

  Instead, they continued to rely on their former colonial powers which controlled their mining, trade, and agricultural production

  Neo-colonialism: decolonized countries remained economically and sometimes politically dependent on their former colonial powers

Theory 3: Globalization

  As the world’s economy became globalized, countries specialized in different aspects

  Developing countries became assigned the role of providing raw materials for developed countries – and so their advanced industries did not develop

Globalization: tendency of businesses, technology, and philosophies to spread

throughout the world; the global economy is characterized as an interconnected

marketplace

Underlying Problems

  Unfair distribution of wealth   Inability to take part in international economic

decisions (ie IMF!!)

GDP per capita

Indicators of Inequality

  HDI (human development idex)   GDP (gross domestic product)   Daily consumption of calories (UNICEF)

Can you guess which country has the highest HDI? The lowest?

Causes of Inequality: Internal Factors

  Climate   Availability of resources   Relationship between resources and population

Causes of Inequality: External Factors

  Colonization   Trade imbalance

  Importing cheap raw materials   Exporting expensive manufactured goods

  Industrial Revolution   Decolonization   Globalization (1990s)

The Center and Periphery

  Central areas: concentrate wealth, main multinational companies, decision-making bodies •  World Triad •  United States •  European Union •  Japan

  Emerging countries •  China •  India •  Brazil

•  Periphery: export raw materials, heavily indebted

The Center and Periphery

•  Regional Powers •  Russia •  Australia •  South Africa

•  Peripheral areas •  Sub-saharan Africa •  Numerous Asian countries •  Numerous Latin American countries

Core (Center)/Periphery Map