Development 3 basic ways to make a living: 1. Growing food 2. Manufacturing products 3. providing services Countries are classified by development: MDC (aka more developed country/developed country) LDC (aka less developed country/developing country Geographic tasks associated with development: Identify where MDCs and LDCs are located Concern for why some areas are more developed than others Key Issue #1: WHY DOES DEVELOPMENT VARY AMONG COUNTRIES? Human Development Index Developed by the UN What does it recognize? How is the HDI created? Economic: gross domestic product per capita Social: literacy rate and amt of education Demographic: life expectancy Economic Indicators of Development How do we distinguish MDCs from LDCs? Economic structure Worker productivity Access to raw materials Availability of consumer goods GDP per capita Why GDP instead of per capita income? Value of total output of goods and services produced in a country, normally in a year GDP/total population-measures the contribution of the average individual makes to the wealth of the country every year GDP cont. What is the difference b/t GDP and GNP? Why can’t GDP measure the level of a country’s development perfectly? Per capita GDP measures average wealth, not distribution of wealth- explain. Types of Jobs Avg GDP per capita higher in MDCs b/c of the way the earn a living 1 of 3 ways: Primary Secondary Tertiary Can also use quaternary Types of jobs cont. Distribution of workers varies b/t MDCs and LDCs 1st priority of people: to obtain food high percentage of workers in agricultural jobs indicates people looking for food to survive Low percentage of workers means primary sector can produce enough food for eveyone Types of jobs cont. If do not have to find food, can move onto secondary and tertiary jobs What does the decline in manufacturing jobs reflect? Employment in service sector continues to rise Productivity Value of a particular product compared to the labor required to make it Why are workers in MDCs more productive than those in LDCs? Measured by value added per worker Gross value of product-minus raw materials and energy costs Raw Materials Measures a country’s potential for development Some countries do not need raw materials to develop-may develop through trade As certain raw materials become important, level of development may advance Sale of resources to finance development Consumer goods Wealth used to buy nonessentials increases manufacturing which increases wealth for a nation Quantity and type of goods and services indicates level of development In LDCs, some goods and services may become desireable Development of “haves” and “have-nots” Social Indicators of Development Education and Literacy Higher level of development, greater the quantity and quality of education Quantity measured by avg # of years spent in school Quality measured by literacy rate and teacher/student ratio Social Indicators cont. Health and Welfare MDCs have more resources to care for people when they get sick Health influenced by diet MDCs also have the means to provide for those that are unable to work (welfare, food stamps, etc.) • Now facing a choice b/t reducing benefits or raising taxes to pay for these programs. Demographic Indicators of Development Life Expectancy Better healthcare=longer life Can strain the system, however Infant Mortality Rate Greater in LDCs-Why? Natural Increase Rate LDC higher than MDC Strains an already strained system Crude Birth Rate Does not indicate a country’s level of development- Why? Chapter 9 Development WHERE ARE MORE AND LESS DEVELOPED COUNTRIES DISTRIBUTED? Countries can be categorized into 9 regions based on level of development Also have distinctive demographic and cultural characteristics Western Hemisphere: Anglo-America and Latin America Europe: Western and Eastern Asia: East, South, Southeast and Southwest Can also include Japan and the South Pacific Distribution of MDCs and LDCs shows a global pattern- what is it? More Developed Regions: Anglo-America, Western Europe and Eastern Europe Less Developed Regions: Latin America, East Asia, Southeast Asia, Middle East, South Asia, sub-Saharan Africa See Chart Chapter 9: Development WHERE DOES LEVEL OF DEVELOPMENT VARY BY GENDER? Overall development of a country masks gender inequalities To solve this, UN created GDI and GEM Gender-Related Development Index Similar to HDI A country w/complete equality has a GDI of 1.0 Economic Indicators How does the UN determine this? Social Indicators Education and literacy Demographic Indicators How does GDI differ from HDI? Why do men outlive women in LDCs? Gender Empowerment Measures ability of women to participate in achieving improvements to std of living How is GEM determined? Complete power equality if GEM=1.0 Economic Indicators of Gender Empowerment Percentage of women holding professional or technical jobs • What may bar a women from getting one of these jobs? Power over economic resources (Share of nat’l income held by women) Gender Empowerment cont. Political Indicators of Empowerment Percentage of the country’s administrative and managerial jobs they hold Percentage of women elected to public office Every country’s GEM is lower than its GDI A higher GEM than GDI means women possess a greater share of a country’s resources than power over allocating those resources Chapter 9 Development WHY DO LESS DEVELOPED COUNTRIES FACE OBSTACLES TO DEVELOPMENT? Development through self-sufficiency Elements of self-sufficiency approach Adopted by China, India most African and Eastern European nations Spread investments as equally as possible across all sectors of its economy and in all regions How do countries promote self-sufficiency? Problems with Self-Sufficiency 2 major problems: 1. Inefficiency-protects inefficient businesses Do not have to keep on top of technological innovations 2. Large bureaucracy-needed to administer the controls Encourages corruption Development Through International Trade Countries have to identify its distinctive or unique economic assets Can economically develop by concentrating scarce resources on expanding unique local industries International Trade cont. Rostow’s Development Model • 5 stage model of development- What is it? • Based on 2 factors: 1. Other MDCs have followed this model and it was successful so why couldn’t others use it 2. Many LDCs contain many of the scarce resources and raw materials that many MDCs are seeking Examples: Persian-Gulf states and the Four Asian Dragons International Trade cont. Problems: 1. Uneven Resource Distribution 2. Market Stagnation 3. Increased dependence on MDCs International Trade cont. Preferred alternative for spurring economic development World wealth is increasing Switching from self-sufficiency to international trade b/c it promotes better development- explain. International Trade cont. World Trade Organization Established in 1995- Why? Works to reduce trade barriers by: 1. Negotiating the reduction or elimination of international trade restrictions on manufactured goods and the movement of money 2. Enforcing agreements Protects the validity of material on the Internet 3. Can also bring charges that someone has violated a copyright or patent International Trade cont. Why do liberals attack the WTO? Why do conservatives attack the WTO? Financing Development Loans Borrow money to build infrastructure • Why infrastructure? • Problem: most of them are failures • Many LDCs cannot repay the loans which damages the stability of banks in the MDCs which loaned the money • What do MDCs now require in order to prevent some of their losses on loans to LDCs?
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