1.1 Economic Transition Flashcards
What are the 4 sectors of employment?
Primary: Collection of natural resources, food and raw materials directly from the land or sea
Secondary: processes, manufacturing, assemble products we need - usually raw materials produce manufactured goods in a factory. Either consumer or capital goods e.g. car engines
Tertiary industry: services health education, retail transport - lots of value and vital to move goods around and financial services essential
Quaternary: high tech manufacturing and service industries provide information and expertise - R&D, engineers, research scientists, computer scientists and biotech workers
What are the advantages/disadvantages of each sector of employment
Primary: raw materials, export, low transport cost, little investment needed, foundation of employment //however unrenewable, depends on global demand, hard to extract, environmental problem
Secondary: fast development, infrastructure, value to primary sector, living standards higher, stronger export and currency, FDI
however vulnerable to global competition, environment, discourages skilled labour and education, depends on demand and supply, depends on price, requires energy
Tertiary: private sector, not run on tax, high skill, education, infrastructure, SOL, life expectancy, tourism
however - supply/demand reliant, leakages, weak currency, requires skilled labour, reliant on disposable incomes
Quaternary: attracts high skill, boosts economy, improves other sectors, multiplier
however needs financial input, reliant on skilled workforce, jobs lost if mechanisation, lots of investment, uncertain outputs, less in tertiary sector
Clark fisher model
3 stages of employment structure
Pre industrial: mainly in primary, mostly subsistence farmers - eat what they grow, little surplus production. High underemployment and few jobs for uneducated population. Secondary low skill crafts, lacks FDI, lack of business and education - secondary and tertiary limited - low development rates and lack of high value exports
Industrial: primary goes down mechanisation, factories, jobs created, TNC jobs involve primary -> secondary, cumulative causation stimulates growth - TNCs, reinvestment into infrastructure, support, education and healthcare
Post-industrial: HIC, few primary sector, mechanisation replaced it or imports cheaper, environmental concerns high so expensive. Most of land rinsed of primary. Secondary employment fallen as jobs moved to MICs as cheaper and ageing populations in HICs. Tertiary industry grow - finance, banking, insurance - 30% of GDP
Why has some employment structures changed
- Improvements in information led to outsourcing, services go from HICs to NICs
- Information led to growth in number of people teleworking
LICs
- Dependent on primary sector and subsistence farming
- High underemployment
- Mining, quarrying, forestry or fishing
- Poor working conditions
- Few s/t/q jobs
- most t jobs in public sector
- primary product dependency
- GNI/capita less than 1005
MICs
- Industrial stage
- Manufacturing from FDI and TNCs
- Increased wealth leads to investment in infrastructure - employment in s
- Increasing welath investment in agriculture - less demand for labout
- quartenary may develop
- Between 1006-12235 GNI/capita
HICs
Post industrial, few employed in p and s mostly in t and q
-Manufacturing outsourced investment in technology replaced human labour
Make over 12235 e.g. UK
What is development
Improvement of quality of life, a wide ranging complex concept including many important aspects of lives. Includes equality, production, GDP, infrastructure, education, health, security, peace, wealth, social development, growth, clean water, sanitation, sustainability - not always about wealth or GDP
Economic - jobs, income, SOL, housing, mobility
Physical - diet, nutrition, water, climate, environment
Social - family/friends, education, health
Psychological - happiness, security, freedom
What are the causes of global inequalities?
Physical geography:
- Landlocked
- Size - pop and resources
- Natural hazards
- Climate and soil
- Pests
- Plants - profits
Political:
- Policies encouraging growth
- Tax, savings, investment
- Open economies
- Trading blocs
Demographic:
- keeps up with growth as need food and services
- may control demographics
- use youthful population to advantage
Historical:
- Former colonies
- Slavery
- Authoritarian regimes
- Conflict
What are the causes of the development gap?
Economic:
- 1/5 live on less than $1 a day, nearly half less than $2
- Some do not benefit from global integration
- Lack ability to pay for food, agricultural innovation and investment
- Difficult to attract FDI and raise tax funds as people can’t pay
Social: 850m can’t read or right
- 1bn no clean water
- 2.4bn no sanitation
- 11m children under 5 die from preventable diseases
- Basic housing and women fewer opportunities
Environmental:
- natural disaster
- raw materials poorly used
- little environmental benefit
- environmental degradation, social degradation
- social erosion
- most resources used to get out of poverty
- TNCs pollute more
Political:
-Poor countries have bad governance and conflict
Benefits and limitations of using development indicators:
Benefits:
- Comparisons,
- Policies
- Show emerging markets and economies
- Rough idea if a country needs aid
Cons:
- No regional disparity
- Complex and hard to measure opportunities and quality of life, governments hide data
- Finding data in poor countries harder
What is GDP and what is done to improve it?
Total value of goods and services produced by a country in a year. Does not include informal economy, subsistence farming, PPP and cost of living, population - government hide data in hopes of air or inequality
GDP/capita accounts for population
Adjusted to PPP by converting into common currency
GNI is together with income received from other countries
What is HDI?
-Broader measure by UN - composite index uses several bases
3 index - health (life expectancy)
education (mean years of schooling and expected years of schooling)
living standards (GNI/capita at PPP)
Given a number between 0 and 1 used in Human Development Report
What tends to fall/rise with development?
Falls:
-Death rates, IMR, BR, people:doctor, workers in agriculture
Rises: LE, population growth, Literacy, food supply, urbanisation, energy consumption, motor vehicles, export volumes, environmental protection, gender equality
Other individual measures:
IMR: differences around world due to efficiency of health. Tends to align with other indicators but other countries may have disparities due to healthcare
Education: seen as key - improving female literacy most fundamental for a developing nation to attain as many aspects as possible of development depend on it. Education is vital for sustainable development
Nutrition: undernourishment may be caused by natural or human made issues. Workforce weaker without nutrition and less able to work, food prices inflate
