MLS 2B Group 8

Baldevieso, Balagosa, Langreo, Lusaya, Sotiar, Lao

Is an increase in a country's real level of national output which can be caused by an increase in the quality of resources (by education etc.), increase in the quantity of resources & improvements in technology or in another way an increase in the value of goods and services produced by every sector of the economy.

It can be measured by an increase in a country's GDP (gross domestic product).

Is an increase in living standards, improvement in self-esteem needs and freedom from oppression as well as a greater choice.

Referred to as the quantitative and qualitative changes in an existing economy.

The most accurate method of measuring development is the Human Development Index which takes into account the literacy rates & life expectancy

Economic Development

Economic Growth

Implications

Economic development implies changes in income, savings and investment along with progressive changes in socio-economic structure of country (institutional and technological changes).

Economic growth refers to an increase in the real output of goods and services in the country.

Measurement

Qualitative.HDI (Human Development Index), gender- related index (GDI), Human poverty index (HPI), infant mortality, literacy rate etc.

Quantitative. Increases in real GDP.

Economic Development Economic Growth

Effect

Brings qualitative and quantitative changes in the economy

Brings quantitative changes in the economy

Relevance

Economic development is more relevant to measure progress and quality of life in developing nations.

Economic growth is a more relevant metric for progress in developed countries. But it's widely used in all countries because growth is a necessary condition for development.

Scope

Concerned with structural changes in the economy

Growth is concerned with increase in the economy's output

In 1960, the American Economic Historian, W.W. Rostow suggested that countries must pass through 5 stages to become developed.

1.) Traditional Society -subsistence economy

-output not traded or recorded -existence of barter -high levels of agriculture and labor intensive agriculture

2.) Pre-conditions:

-Development of mining industries -Increase in capital use in agriculture -Necessity of external funding -Some growth in savings and investment

3. ) Take off -Increasing industrialization -Further growth in savings and investment -Some regional growth -Number employed in agriculture declines

4. )Drive to Maturity -Growth becomes self-sustaining

-Wealth generation enables further investment in value adding industry and development -Industry more diversified -Increase in levels of technology utilized

5.) High mass consumption -High output levels -Mass consumption of consumer durables -High proportion of employment in service sector

Development is determined by the extent to which the market is able to allocate resources

The price signal acts to allocate scarce resources

Governments limit interference in the working of the economy

Government role is to encourage enterprise and to reduce regulation and inefficiencies in free markets and establish ownership of property rights

Gross Domestic Product (GDP) is an estimated value of the total worth of a countrys production and services, within its boundary, by its nationals and foreigners, calculated over the course on one year.

GNP = GDP + NR NP

Or

GNP= GDP + Net factor income from abroad

Gross National Product (GNP) is an estimated value of the total worth of production and services, by citizens of a country, on its land or on foreign land, calculated over the course on one year.

GNP= Gross National Products GDP= Gross Domestic Product NR= Net income inflow from assets abroad or Net Income Receipts NP= Net payment outflow to foreign assets

A tool developed by the United Nations to measure and rank countries' levels of social and economic development based on: Longevity, measured by life expectancy at birth

Knowledge, measured by adult literacy and number of years children are enrolled at school

Standard of living, measured by real GDP per capita

A scale from 0 (lowest human development) to 1 (highest human development).

An index of 0 0.49 means low development

An index of 0.5 0.69 means medium development

An index of 0.7 to 0.79 means high development

Above 0.8 means very high development

adjusts the Human Development Index (HDI) for inequality in the distribution of each dimension across the population.

IHDI accounts for inequalities in HDI dimensions by discounting each dimensions average value according to its level of inequality.

The IHDI equals the HDI when there is no inequality across people but falls below the HDI as inequality rises. In this sense, the IHDI is the level of human development when inequality is accounted for

reflects womens disadvantage in three dimensions: reproductive health

empowerment

labor market

The index shows the loss in human development due to inequality between female and male achievements in these dimensions. It ranges from 0, which indicates that women and men fare equally, to 1, which indicates that women fare as poorly as possible in all measured dimensions.

identifies multiple deprivations at the household level in education, health and standard of living.

complements monetary measures of poverty by considering overlapping deprivations suffered by people at the same time.

index identifies deprivations across the same three dimensions as the HDI and shows the number of people who are multi-dimensionally poor and the number of deprivations with which poor households typically contend with.

It can be deconstructed by region, ethnicity and other groupings as well as by dimension, making it an apt tool for policymakers.

Lifestyle Losses

Generational Transfers

Population

Consumption

Garbage

Pollution

Congestion

Natural resource depletion

Corruption

Economic Growth is unstable

Environmental problems

Low Inflation

Cheap imports

Growing export market

Financial surplus

Depletion of the global resource base and the

impact of global warming.

Huge expansion of waste and

pollution

Over population

Species extinction leading to a

loss of bio-diversity.