1ST LE Flashcards
1
Q
“millions upon millions of our human family are living imprisoned by economic poverty, by political tyranny, by sickness and disease, by ignorance, and by oppression and violence”
A
Amartya Sen
2
Q
defined as living at a consumption (or income) level below 1.90 intl dollars per day (106.45 PHP) until 2010
A
Extreme poverty
3
Q
how many people lived below the 2.15 $ per day poverty line in 2019
A
648 million
4
Q
international poverty line in 2015
A
$2.15 per day
5
Q
the unequal distribution of resources, opportunities, and power that shape well being among the billion individuals on our planet.
A
global inequality
6
Q
divided by contrary views on government and the politically correct society
A
four worlds
7
Q
the bloc of democratic-industrial countries within the american influence sphere
A
First world
8
Q
the eastern bloc of the communist-socialist states
A
second world
9
Q
countries not aligned with either bloc
A
third world
10
Q
widely unknown nations of indigenous people living within or across national state boundaries
A
fourth worldwh
11
Q
who coined the term fourth world
A
shuswap chief George Manuel
12
Q
“what the third world originally was, then, is clear: it was the non-aligned world of poor coutnries. Their poverty was the outcome of a more fundamental identity, they had all been colonized”
A
Peter Worsley
13
Q
list the categories of third world countries
A
- in terms of political rights and civil liberties
- in terms of their Gross National Income (GNI)
- in terms of Human Development
- in terms of Poverty
- in terms of press freedom
14
Q
what makes a nation third world?
A
- suffer form high infant mortality, low economic development, high levels of poverty, low utilization of natural resources, and heavy dependence on industrialized nations
- poor with unstable governments
- high rates of population growth, illiteracy and disease
- LACK OF A MIDDLE CLASS and very small elite upper class
- have a very large foreign debt
15
Q
categories of development
A
- least developed countries (LDCs)
- landlocked developing countries (LLDCs)
- more developed countries (MDCs
- less developed countries
- sovereign debt and credit rating of countries
16
Q
total monetary or market value of all finished goods and services produced WITHIN the country’s borders
A
Gross Domestic Product (GDP)
17
Q
a financial metric that breaks down a country’s economic output per person and is calculated by dividing the GDP by its population
A
Per Capita GDP
18
Q
the value of all goods and services made by a country’s residents regardless of production location
A
Gross National Product
19
Q
measures income earned, including income from investments that flows back into the country
A
Gross National Income
20
Q
indicator of country’s financial position
A
compare general government’s gross debt to its gross domestic product (GDP)
21
Q
development as a multidimensional process
A
changes in social structures, attitudes, national institutions
acceleration of economic growth
eradication of poverty
reduction of inequality
22
Q
the process of improving the quality of all human lives and capabilities by raising people’s level of living self-esteem and freedom
A
development
23
Q
the challenge of development
A
- reduction and elimination of poverty and inequality within the context of growing economy
improve - improve quality of life - higher incomes, better education, equality of opportunity, greater individual freedom, and richer cultural life
24
Q
three objectives of development
A
- increase availability and widen the distribution of basic life sustaining goods
- raise levels of living: material well being, jobs, education
- expand the range of economic and social changes
25
three core values of development
sustenance, self-esteem, freedom from servitude
26
dimensions of deprivation
absolute poverty and subsistence economy
27
A situation of being unable to meet the minimum
levels of income, food, clothing, health care, shelter,
and other essentials
absolute poverty
28
An economy in which production is mainly for
personal consumption and the standard of living
yields little more than basic necessities of
life—food, shelter, and clothing.
subsistence economy
29
process through which individuals or
groups are wholly or partially excluded from full
participation in the society in which they live.
social exclusion
30
source of social exclusion
european foundation, 1995
31
Poverty cannot be properly measured by income or even by
utility as conventionally understood; what matters
fundamentally is not the things a person has—or the
feelings these provide—but what a person is, or can be, and
does, or can do.
capability approach
32
what is Global MPI and OPHI
Global Multidimensional Poverty Index and Oxford Poverty and Human Development Initiative
33
categories of development
human development index and human capital
34
hdi dimenstions
a long healthy life, knowledge, decent standard of living
35
indicators of hdi dimensions
long and healthy life = life expectancy at birth
knowledge = years of schooling
decent standard of licing = GNI per capita
36
core necessities for development
economic: incomes, prices, savings, investments
non-economic/institutional: land tenure arrangements, structure of credit/debt servicing, education and health systems, governance/organization and motivation of governments, machinery of public administration, role of political elites, human rights and dignity, climate justice
37
comparative economic development
population and human wellbeing, food and water resources, economics and trade, current account balance, institutions and governance
38
indicators of comparative economic development
population and human well being - population, health, education, poverty, infant mortality, and prevalence of HIV/AIDS
food and water resources - intensity of agricultural inputs, food security, and nutrition, fisheries production and water resources
economics and trade - gdp, gdp distribution by sectors, adjusted net savings, export of goods and services, and financial flows
current account balance - difference between value of exports and value of imports; ratings from AAA to BBB
institutions and governance - freedom indices of civil liberties and political rights, regulatory barriers, government expenditures for public health, public education, military, people's access to info
39
the world bank classified countries as
severely indebted, moderately, and less indebted
40
comparisons between developed and developing
countries are exaggerated by the use of official
foreign exchange rates
purchasing power parity
41
important features common among developing countries
1. Lower levels of living and productivity
2. Lower levels of human capital
3. Higher levels of inequality and absolute poverty
4. Higher population growth rates
5. Greater social fractionalization
6. Larger rural populations but rapid rural-to-urban
migration
7. Lower levels of industrialization
8. Adverse geography
9. Underdeveloped financial and other markets
10. Lingering colonial impacts such as poor institutions and
often external dependence.
42
formula for calculation of GDP
GDP = consumption + investment + govt spending + (exports-imports)
43
formula of GNP
GNP = GDP + NR (Net income receipts/inflow from assets abroad) - NP (net payment outflow to foreign assets)
44
causes of hunger and poverty
Economic systems
Demographic systems
Conflict, territorial and cultural tensions
Climate change
Governance and politics
45
total income for the wealthiest 20% of Filipinos is what and give the source
eight times greater than the bottom 20% (USAID, 2014)
46
poverty in philippines in 1985
49.2%
47
poverty in philippines in 2018
16.7%
48
population of middle class as of nov 2022
12 million people
49
“The Philippines aims to become a middle-class society
free of poverty by 2040, but we know from global
experience that no country has managed to make this
transition while maintaining high levels of inequality,"
Ndiame Diop
50
Classical theories of economic development
1. linear stages of growth model
2. theories and patterns of structural change
3. the international dependence revolution
4. the neoclassical free market counterrevolution
51
person behind stages-of-growth model
Walt W. Rostow
52
what are the stages of growth model
traditional society
precondition for take off
take off
drive to maturity
age of high mass consumption
53
The mobilizaation of domestic and foreign
saving in order to generate sufficient
investment to accelerate economic growth.
take off
54
a functional economic
relationship in which the growth rate of gross domestic
product (g) depends directly on the national net savings rate
(s) and inversely on the national capital-output ratio (c).
harrod-domar model
55
If a country’s national income savings are at ____
of GDP, it is at takeoff stage already
15-20%
56
a ratio that shows the units of
capital required to produce a unit of output over a given
period of time.
capital output ratio
57
savings expressed as a proportion of
disposable income over some period of time.
net saving ratio
58
critique of linear stages of growth model
➔ It assumes a one-size-fits-all goal of industrialized, capitalist liberal democracy.
➔ It can be a justification of foreign aid.
➔ Both the Rostow and Harrod-Domar models implicitly assume that underdeveloped countries have the necessary structural,
institutional, and attitudinal conditions to convert new capital effectively into higher
levels of output.
59
a condition that must be present
although it need not be in itself sufficient, for an event to
occur. But for this growth to continue, social, institutional,
and attitudinal changes may have to occur.
necessary condition
60
a condition that when present causes or guarantees that an event will or can occur; in economic models, a condition that logically requires that a statement must be true (or a result must hold) given other
assumptions.
sufficient condition
61
focuses on the mechanism by
which underdeveloped economies transform their domestic
economic structures from a heavy emphasis on traditional
subsistence agriculture to a more modern, more urbanized,
and more inductrially diverse manufacturing and service
economy.
structural change theory
62
underlines the importance of transfers of resources from low productivity to high productivity activities; attempts to analyze the many linkages between traditional agriculture and modern industry case of China
structural change
63
The process of transforming
an economy in such a way that the contribution to national
income by the manufacturing sector eventually surpasses the
contribution by the agricultural sector. More generally, a
major alteration in the industrial composition of any
economy.
structural transformation
64
A theory of development in
which surplus labor from the traditional agricultural sector
is transferred to the modern industrial sector, the growth of
which absorbs the surplus labor, promotes industrialization,
and stimulates sustained development
lewis two sector model
65
who formulated lewis two sector model
w. arthur lewis
66
who modified formalized and extended lewis two sector model
john fei and gusav ranis
67
Underdeveloped economies consists of two sectors:
traditional, overpopulated, rural
subsistence sector AND a high-productivity modern, urban
industrial sector
68
The excess supply of labor over and above
the quantity demanded at the going free-market wage rate.
In the Lewis two-sector model of economic development,
surplus labor refers to the portion of the rural labor force
whose marginal productivity is zero or negative.
surplus labor
69
A technological or engineering
relationship between the quantity of a good produced and
the quantity of inputs required to produce it
production function
70
Total output or product divided by
total factor input (e.g., the average product of labor is equal
to total output divided by the total amount of labor used to
produce that output).
average product
71
The increase in total output resulting
from the use of one additional unit of a variable factor of
production (such as labor or capital). In the Lewis
two-sector model, surplus labor is defined as workers whose
marginal product is zero.
marginal product
72
Economic growth that continues
over the long run based on saving, investment, and
complementary private and public activities.
self sustaining growth
73
Assumptions of Lewis Model
1. The marginal Product of labor is zero (surplus
labor)
2. this implies that labor can be removed from the
agricultural sector without any loss of output in
that sector
3. The rural supply of labor to industrial section is
perfectly elastic
4. full employment in the urban sector
5. Constant urban wage- premium over a fixed average
substinence wage.
6. Capitalist reinvest all profits
7. Rate of labor transfer job creation is proportional
to the rate of capital accumulation
74
focuses on the
sequential process through which the economic, industrial,
and institutional structure of an underdeveloped economy is
transformed over time to permit new industries to replace
traditional agriculture as the engine of economic growth.
patterns of developmental analysis
75
Domestic constraints in structural change model
1. Economic: country’s resource endowments and
population size.
2. Institutional: gov’t policies and objectives
76
who identified common patterns across various countries like time series analysis and crosss sectional analysis
Hollis B. Chenery and his colleagues
77
involves looking at data
from a single country over time
time series analysis
78
involves comparing data
from different countries at a specific point in time
cross sectional analysis
79
In international affairs, a situation in which
the developed countries have much greater power than the
less developed countries in decisions affecting important
international economic issues, such as the prices of
agricultural commodities and raw materials in world
markets
dominance
80
The reliance of developing countries on
developed-country economic policies to stimulate their own
economic growth.
dependence
81
A model whose
main proposition is that underdevelopment exists in
developing countries because of continuing exploitative
economic, political, and cultural policies of former colonial
rulers toward less developed countries.
The Neocolonial Dependence Model
82
An economic situation characterized
by persistent low levels of living in conjunction with
absolute poverty, low income per capita, low rates of
economic growth, low consumption levels, poor health
services, high death rates, high birth rates, dependence on
foreign economies, and limited freedom to choose among
activities that satisfy human wants
underdevelopment
83
In dependence theory, the economically developed
world
center
84
In dependence theory, the developing
countries.
periphery
85
Underdevelopment is seen as externally induced phenomenon; not just internal phenomenon
International-dependent models
86
Why are we scared of globalization/capitalism?
Because of the elite few that controls the economy despite it not being their territory.
87
In dependence theory, local elites who
act as fronts for foreign investors.
comprador group
88
“...Dependence, then, is based upon
an international division of labor which allows industrial
development to take place in some countries while
restricting it in others, whose growth is conditioned by and
subjected to the power centers of the world.”
theotonio dos santos
89
“One must denounce the existence of
economic, financial, and social mechanisms which, although
they are manipulated by people, often function almost
automatically, thus accentuating the situation of wealth for
some and poverty for the rest…”
pope john paul ii
90
The proposition that
developing countries have failed to develop because their
development strategies (usually given to them by Western
economists) have been based on an incorrect model of
development
false paradigm model
91
attributes underdevelopment to faulty and
inappropriate advice provided by well-meaning but
often uninformed, biased, and ethnocentric international “expert” advisers from
developed-country assistance agencies and
multinational donor organizations
false paradigm model
92
the existence and persistence of substantial and
even increasing divergences between rich and poor nations
and rich and poor peoples on various levels.
dualism
93
A closed economy that attempts to be
completely self-reliant
autarky
94
The 1980s resurgence of
neoclassical free-market orientation toward development
problems and policies, counter to the interventionist
dependence revolution of the 1970s.
Neoclassical counterrevolution
95
it called for freer markets
and the dismantling of public ownership, statist
planning, and government regulation of economic
activities.
Neoclassical counterrevolution
96
The system whereby prices of commodities
or services freely rise or fall when the buyer’s demand for
them rises or falls or the seller’s supply of them decreases or
increases.
Free markets
97
The theory that self-interest guides all individual behavior
and that governments are inefficient and corrupt because
people use government to pursue their own agendas.
public choice theory
98
The notion historically
promulgated by the World Bank that successful
development policy requires governments to create an
environment in which markets can operate efficiently and to
intervene only selectively in the economy in areas where the
market is inefficient.
market friendly approach
99
A market’s inability to deliver its
theoretical benefits due to the existence of market
imperfections such as monopoly power, lack of factor
mobility, significant externalities, or lack of knowledge.
market failure
100
The number of units of capital per
unit of labor.
capital labor ratio
101
Growth model in
which there are diminishing returns to each factor of
production but constant returns to scale
solow neoclassical growth model
102
An economy in which there are no foreign trade transactions or other economic contacts with
the rest of the world.
closed economy
103
An economy that practices foreign trade and has extensive financial and nonfinancial contacts with
the rest of the world
open economy
104
G7
CANADA, GERMANY, ITALY, JAPAN, UK, US, FRANCE
105
G8
RUSSIA
106
G20
ARGENTINA, AUSTRALIA, BRAZIL, CHINA, EU, INDIA, INDONESIA, MEXICO, SAUDI ARABIA, SOUTH AFRICA, SOUTH KOREA, AND TURKEY
107
An annual
meeting between leaders from
eight of the most powerful countries
in the world
G8 SUMMIT
