Chapter 23 Flashcards
What is the primary sector
Production that uses natural resources, extraction of raw materials, such as growing crops
What is the secondary sector
Production of manufactured goods, raw materials or crops being turned into goods
What is the tertiary sector
Production (and provision) of services, production based on information technology and information products. Such as wifi. a subset of this is information such as scientific research
What is sustainable development
Development that meets the needs of the next generation without compromising the needs of the future generation
What is HDI
A composite measure of a countries development, 0 (lowest - 1 (highest)
What is development
A process by which real per capita incomes are increased and habitats of a country are able to benefit from improved livings condition. Ie lower poverty and enhanced education and healthcare - basic essentials of life. Expansion of PPC
Issues with GNI/GDP
Exchange rate problems, all data is represented by USD, however, it does not take into account the purchasing power in different countries. Most LDCs use international currencies and therefore may represent government policy. Doesn’t provide information on how income Is distributed across the country. Hidden markets are not taken account of
What are the 3 measurements taken into account for HDI
Recourses (GNI per capita at PPP), Expected years of schooling, life expectancy at birth and standards of living
Why is GNI used instead of GDP in HDI
To take into account remittances and foreign aid.
Issues with HDI
Does not consider how free people are politically, does not take into account the environment,
What is Human poverty index (HPI)
measures life expectancy, education and ability of citizens to meet basic needs. There are 2 types: HPI 1 - measures the probability of living to the age 40 - considers education health and living standards.
HPI 2 - the probability of not surviving to age 60. The percentage of adults without literacy skills. poverty is calculated by those on the poverty line.
Factors contributing to economic growth
Trade liberalisation, privatisation, infrastructure development, development of human capital, development of primary sectors (comparative advantage)
Why might GNI per capita (exchange rate due to USD) reflect government policy
As government can choose to undervalue their exchange rate to maximise export volume. Or overvalue their economy to maximise export revenue
Which countries tend to have a high dependence on primary sectors
Less developed countries (LDCs)
What are the issues of having high dependence on the primary sector
It displays low productivity and their is less scope to exploit increasing returns than in manufacturing. Tends to mean low-income per head as some many people. They face more volatility to international markets an falling prices.
