Session 9: Development

1) Participant observation presentations

2) Chapter 11: 11.1: How is development measured (continued)

3) Chapter 11: 11.2: How does geographical situation affect development?

4) Chapter 11:11.3: What are the barriers to, and the costs of, development?

5) Chapter 11: 11.4: How do political and economic institutions influence uneven development within states?

Fouberg, E. H., Murphy, A. B., De Blij, H. J. and C. J. Nash (2012). Human Geography: People, Place, and Culture. John Wiley & Sons Canada, Ltd., Mississauga.

March 20/27, 2015

Questions for reflection:

1. What are the pros and cons of the “sharing economy”?

2. Do you think the “sharing economy” will slow down / can slow down? Why or why not?

Development Models

Many theories of development grew out of the major development colonization movements of the 1960s…”development” very focused on Western ideals of economy

Modernization model: A model of economic development most closely associated with the work of economist Walter Rostow. The modernization model (sometimes referred to as modernization theory) maintains that all countries go through five interrelated stages of development, which culminate in an economic state of self-sustained economic growth and high levels of mass consumption.

5 interrelated stages of development of the modernization model:

1. “Traditional”: subsistence farming; rigid social structure; slow changing technology

2. “Preconditions for takeoff”: active leadership pushes country towards flexibility and diversification

3. “Takeoff”: like industrial revolution

4. “Drive to maturity”: technology diffuses; specialization occurs; international trade expands

5. “High mass consumption”: high incomes; high domestic production of goods and services

Section 11.2 – How does geographical situation affect development?

Criticism of Rostow’s model: lack of consideration for how development happens in context.

Context: The geographical situation in which something occurs; the combination of what is happening at a variety of scales concurrently.

To understand why some countries are rich and some are poor we need to understand the context at various scales.

Colonialism made colonies dependent on colonizers

Following the end of colonization, the social economic and political structures of colonialism persisted

Poor countries remain in a position of dependency

Some scholars call this:

Neo-colonialism: The entrenchment of the colonial order, such as trade and investment, under a new guise.

When political independence occurs it does not always translate into economic independence

Theory taking into account neo-colonialism

Structuralist theory: A model of economic development that treats economic disparities among countries or regions as the result of historically derived power relations within the global economic system

Dependency theory: A structuralist theory that offers a critique of the modernization model of development. Based on the idea that certain types of political and economic relations (especially colonialism) between countries and regions of the world have created arrangements that both control and limit the extent to which regions can develop.

Dependency theorists would typically see little hope for economic prosperity for nations that have been dominated by external powers.

This however is a generalization, and there are nations and regions of the world that have been “dependent” who have made considerable economic gains.

e.g., India is considered to be an emerging market (was at one time a British colony)

Geography and Context

World-systems theory: Theory originated by Immanuel Wallersteinand illuminated by his three-tier structure, proposing that social change in the developing world is inextricably linked to the economic activities of the developed world.

3 basis tenets:

1) The world economy has one market and a global division of labour

2) Although the world has multiple states, almost everything takes place within the context of the world economy

3) The world economy has a three-tiered structure

Three-tier structure: With reference to Immanual Wallerstein’sworld-systems theory, the division of the world into the core, the periphery, and the semi-periphery as a means to help explain the interconnections between places in the global economy.

source: wahyusetyaningrum.wordpress.com

Looking at processes in terms of core, periphery, and semi-periphery

Core (processes): incorporate higher levels of education, higher salaries, and more technology; generate more wealth

Periphery (processes): incorporate lower levels of education, lower salaries, and less tech; generate less wealth

Semi-periphery (processes): places where core and periphery processes are both occurring; places exploited by the core, which in turn exploit the periphery

Section 11.3 – What are the barriers to, and the costs of development?

International organizations and governments work towards breaking down barriers to development – aiming to improve conditions for people around the world

Millennium Development Goals: A set of eight human development-related goals for the world’s most impoverished countries, which were adopted at the United Nations Millennium Summit in 2000 with the intention of achieving all of these goals by the year 2015.

*See Table 11.3 in your text

Example of MDG Advocacy Group’s work

MDG#1: Poverty (2014)

India Fisheries

https://www.youtube.com/watch?v=kjIdutXVdBw&list=PLwoDFQJEq_0Y57bsPH-5zcRnDlXJRz87x&t=132

Recent campaign:

"I am moved by the fact that a child dies every 2 and a half minutes from diseases linked to open defecation. Those are silent deaths –not reported on in the media, not the subject of public debate. Let's not remain silent any longer"

UN Deputy Secretary-General, Jan Eliasson (May 2014)

Barriers to Economic Development - Social Conditions

Trafficking: When a family sends a child or an adult to a labour recruiter in hopes that the labour recruiter will send money, and the family member will earn money to send home.

Definition can be extended. Not all trafficking is done at the hands of a person’s family.

Maiti Nepal – Organization geared towards stopping human trafficking (sex trafficking in India and Nepal)

Founder: Anurandha Koirala

2.5 million people were in forced labour at any given time in 2007

90% of these people were from peripheral countries

Majority of people were between the ages of 18 and 24

43% of victims were forced into sexual exploitation

*Access to primary education is important for counteracting human trafficking in the periphery

Barriers to Economic Development – Foreign Debt

1960s: decolonization wave – banks began loaning money to newly independent states

World Bank and IMP loans with “strings attached”:

Structural adjustment loans: Loans granted by international financial institutions such as the World Bank and the IMF to countries in the periphery and semi-periphery in exchange for certain economic and governmental reforms in that country (e.g., privatization of certain government entities and opening the country to foreign trade and investment).

Repaying of debt made it hard to invest in more long-term development goals

Barriers to Economic Development – Disease

Vectored disease

Malaria – kills approx. 150,000 children in the global periphery each month

Ways of preventing malaria:

• Mosquito nets

• Pesticides

• Anti-malarial drugs

Political Instability

Can greatly impede economic development

• disparity between rich and poor

• corruption

• civil unrest

Costs of Economic Development

Development is change – some of it is not always beneficial

Industrialization

Export processing zones (EPZs): Zones established by many countries in the periphery and semi-periphery where they offer favourable tax, regulatory, and trade arrangements to attract foreign trade and investment.

In 2007 – estimated that the world had 2,700 Export Processing Zones (EPZs)

Estimated 63 million people employed in these zones, which are mostly in peripheral regions

40 million of them in China

2 of these zones in Canada:

1) Gander Foreign Trade zone, Newfoundland

2) CentrePort Canada, Winnipeg

http://www.centreportcanada.ca/

Video

What is CentrePort Canada?

https://www.youtube.com/watch?v=XEH4Ewlp_-o

North American Free Trade Agreement (NAFTA): Agreement entered into by Canada, Mexico, and the United States in December 1992 that took effect on January 1, 1994, to eliminate the barriers to trade in, and facilitate the cross-border movement of goods and services between countries.

Special economic zone: Specific area within a country in which tax incentives and less stringent environmental regulations are implemented to attract foreign business and investment.

Maquiladora: Zones in northern Mexico with factories supplying manufactured goods to the U.S. market. The low-wage workers in the primarily foreign-owned factories assemble imported components and/or raw materials and the export finished goods.

Costs of Economic Development

Agriculture

Large-scale production in the peripheral often does little for local poverty; food is mostly exported

Desertification: The encroachment of desert conditions on moister zones along the desert margins, where plant cover and soils are threatened by desiccation-through overuse, in part by humans and their domestic animals, and possibly, in part because of inexorable shifts in Earth’s environmental zones.

Tourism

Costs of Economic Development

Tourism

Host countries must make substantial investments to support tourism

Tourism companies may not be local and profits may be earned away from the host country – may cause exploitation of the nation and its people

Can cause erosion of local culture through commodification

Section 11.4 – How do political and economic institutions influence uneven development within states?

The Role of Governments

Poverty is not confined to the periphery - Shapes patterns of development within and outside of states

Governments play a role in determining whether, how, and wherewealth is produced. It does this through:

• tariffs• trade agreements• taxation structures• land ownership rules• environmental regulations• etc.

These factors all influence the commodity chain

Governments will prioritize certain regions based on development and economic growth

These are islands of development

Creating Growth in the Periphery of the Periphery

Non-governmental organizations (NGOs): International organizations that operate outside of the formal political arena but that are nevertheless influential in spearheading international initiatives on social, economic and environmental issues.

“a parallel state, financed by foreigners and accountable to nobody” – the Economist

e.g., World Vision, Aga Khan Foundation, …many more, some local, some regional, some global

Microcredit program: Program that provides small loans to poor people, especially women, to encourage development of small business.

World Bank Video: Mauritania: Women Microfinance

https://www.youtube.com/watch?v=xffDu_EWLWc