Development

Question 1

What is development?

Answer 1

The progress that a country makes to improve the quality of life for it population and make a country more independent
Not smooth and continuous -> can fluctuate and will over time

Question 2

Define quality of life

Answer 2

A group of subjective evaluation of life -> ex: happiness
All components are linked -> ex: health and environment is dependent on income, which affects happiness

Question 3

What are some different things that could effect quality of life?

Answer 3

Physical
Water supply, housing, power and heat, climate, diet, nutrition

Social
Family and friends, education, health

Psychological
Happiness, security, freedom

Economic
Income, job, standard of living

Question 4

What can further development in a country?

Answer 4

Investment in:
Agriculture
Food supply/health
Power supplies for rural area
Access to education for females
Literacy rates

Question 5

What can hinder development in a country?

Answer 5

War or conflict
Disease
Disasters
Economic recession

Question 6

What is the cycle of wealth?

Answer 6

Key development indicators

Economic development:
economic wealth (more people work and earn more)-> disposable income + governmental taxes -> other+ governmental taxes from disposable income -> increased business profits -> profits + taxes=investment -> development -> repeat

Question 7

What are some measure of national income?

Answer 7

GDP/ capita

GNP/capita

PPP

GNI

Question 8

What is GDP/ capita?

Answer 8

Total value of goods and services produced within a country in a year divided bu population

Dividing by population -> accurate comparisons
But doesn’t show variation
Can’t know how it is spent

Question 9

What is GNP/capita?

Answer 9

The value of the products and services produced by citizens both domestically and internationally (no income of foreign residents)

Used when comparing the population (the people of the country??)
Doesn’t take into account cost of living

Question 10

What is PPP?

Answer 10

Measures how much you would need to spend in one country to get the same goods and services as in another country

Used to even discrepancy in GNP

Question 11

What is GNI?

Answer 11

Value of a country’s economic production and income of received from abroad

Question 12

What do measure of national incomes fail to show?

Answer 12

The wealth distribution/gap
Government investment into the people
Where the investment is going
And levels of development vary locally, nationally and internationally -> fails to show that

Question 13

What is HDI?

Answer 13

Created by UN in 1990
Measures disparities between countries using 5 indicator:
Life expectancy at birth
Average years of school (adult 25 years)
Expected years of school
GNI/capita

Question 14

How does HDI score and group countries?

Answer 14

4 groups:
Very high human development (VHHD)
High human development (HHD)
Medium human development (MHD)
Low human development (LHD)

Scored on a scale from 0-1
Higher score -> higher development + quality of life
Highest: Norway (0.957), Lowest: Niger (0.394)

Question 15

What is the GINI coefficient index?

Answer 15

Used to analyse the distribution of wealth and identify countries where wealth distribution is most unequal (fill in gaps messed by GNP and HDI)

Question 16

How is the GINI coefficient index measured?

Answer 16

On a scale 0-1 or as a percentage
High score -> unequal
Low score -> equal

Average -> 0.24-0.63
Highest inequality -> South Africa, Central Africa, Namibia, Zambia, Suriname
Lowest inequality -> Czech Republic, Croatia

Question 17

What does transparency international measure?

Answer 17

Political corruption (highly impacts development and welfare-> money isn’t invested into the people and instead those in power take it)

Transparency international
Scores 180 on public sector corruption
Scored out of 100
High -> less corruption (ex: 85+ Denmark New Zealand, Finland, Singapore)
Low -> more corruption (ex; 15- Somalia, Syria, South Sudan)

Question 18

What are the 4 stages of development (according to the UN)?

Answer 18

Least developed countries
Developing countries
Newly industrialized countries
Developed countries

Question 19

What is a development gap?

Answer 19

Difference in levels of development between most and least developed countries

Question 20

What factors could lead to a development gap?

Answer 20

Geography:
Landlocked countries
Small countries
Extreme climates
Extreme landscapes

Natural resources:
No security of supply
Very important, but reliance on imports could be a problem
Water, forest, fossil fuels, soil, rocks, minerals, animals, etc

Demography:
Population structure of the country (birth rates and death rates)
Migration

Technology:
Increase water food and energy security
Mechanisation of farming
Improved land surveying
Efficiency

Social:
Education
Healthcare
Equality

Government policies:
Stability and effectiveness of government
Democratically elected -> generally more development
Government economic policies -> open economy, more development

Question 21

What is the cumulative causation theory?

Answer 21

Explanation for differences of development within a country

Growth in core regions (new large businesses) -> more jobs -> attract workers (increased population) and investment (increased in core areas due to demand) -> average income increases + increased taxes + investment -> outer regions lose workers and investment -> gap grows between the two -> growth spread to the outer regions due to demand in raw materials

Question 22

What are the 3 stages of regional inequality?

Answer 22

Pre-industrial age -> regional difference are at lowest
Period of rapid economic growth -> increasing regional differences
Regional economic convergence -> where wealth from the core spread

Question 23

What are causes of regional inequality?

Answer 23

Residence:
Urban areas -> greater investment

Ethnicity:
Discrimination towards ethnic groups
Lower income that dominant groups
Reduces opportunites to certain groups

Employment:
Formal employment -> usually higher income and benefits
Informal employment -> usually lower income and benefits

Education:
Higher level of education -> higher paying jobs

Land ownership:
Inequalities in land ownership -> linked to inequalities in income

Question 24

What is economic activity?

Answer 24

production, purchase or selling of goods and services

Question 25

What are the 4 sectors of economic activity?

Answer 25

Primary sector (raw materials -> mining, fishing, farming)
Secondary sector (production -> factory workers, clothing, steel, production)
Tertiary sector (services -> nurses, lawyers, teachers, shop assistants, chefs)
Quaternary sector (knowledge -> scientist, researchers, development)

Can be indicators of development

Question 26

How are economic sectors used as a indicator of economic development?

Answer 26

See how much each sector contributes to GDP or the percentage of the population they employ

Question 27

What are the 3 stages of development, using economic sectors?

Answer 27

Pre-industrial period:
Primary sector dominates
Increase in secondary and tertiary

Country developed -> reliance on primary decreases

Industrial period:
Secondary sector increases to become dominant then decreases
Tertiary increase
Primary decreases

Post-industrial period:
Tertiary and quaternary sector increase
Secondary and primary decreases
Tertiary sector dominates

Question 28

What causes the change in percentage employed by each sector?

Answer 28

Increased mechanisation in agriculture (decrease in primary sector jobs)

People move to urban areas (secondary and tertiary sectors)

Increased mechanization and global changes (decrease in secondary employment)

Technological improvements (increase in tertiary and quaternary sectors)

Question 29

What is globalisation?

Answer 29

Where the world becomes more interconnected through economics, culture, politics, trade, and tourism (also environmental -> ex: global warming)

Question 30

What is time-space compression?

Answer 30

Places seem closer together and more interconnected due to improvements in transport and communications

Past -> trade take weeks to years, modern -> trade and communication almost instantaneous

Question 31

What has increased globalisation in recent times?

Answer 31

Removal of political borders -> countries are more interdependent, powerful countries affect the world world

Growth of regional economic and trading blocs

Improvements in technology and communications (WWW and internet -> faster, deeper and longer)

Development of transport (faster transport)

Question 32

What is another word for connections (in terms of globalisation)?

Answer 32

Network flows

Question 33

Development has created a global economy with many connections/network flows -> what are they?

Answer 33

Trade:
Import and export of raw materials, food, services, etc.

Aid:
Mostly economic
Developing countries invest in education, health infrastructure, etc.

Foreign investment:
Directly or indirectly -> business opportunites

Labor:
Labor migration -> important to economy

Information:
Fast date transfer and communication

Question 34

What are commodity chains?

Answer 34

Stages involved in manufacturing goods

Question 35

What does economies of scale entail?

Answer 35

Cost per item reduces when operated on a large scale

Transport improvements -> cost reduced and moved quicker

Labour cost -> cheaper in emerging/ developing countries, also reduced legal restrictions

Question 36

How can foreign investment help a country?

Answer 36

Individuals and firms invest:
Call centers in India
Investment into country -> local people trained, buildings, taxes
Service provided to donor country

Moving manufacturing from developed -> less developed countries
China is main area for manufacture
Investment into china to produce goods
Good sent back to original country

Investment into the people (labor or expertise)
Surgeons from USA -> Australia
Investment into development attracts labor -> contradiction in Dubai attracts Indian immigrants
Research and development -> motor industry (ex: tesla)

Investment via aid
Rebuild from disaster
Ukraine -> aid provided after war
Fund to gouvernement (may lead to corruption)
Goods and services directed to affected areas + refugee camps

Question 37

What is a TNC?

Answer 37

Trans National Corporation

Operate in foreign countries individually and not through a centralised management system

Very important in global economies

Question 38

What role do TNC play in the global economy?

Answer 38

Government and countries set rules for global economy -> TNCs are main investors
TNCs involved in all economic sectors -> impact global economy
Largest TNCs represent biggest % of total global production

TNCs directly invest in one country -> later expand to developing countries
Some only look to expansion of business and not harmony with operating country (need to pleased shareholders)

Process of moving manufacturing results in development of emerging economies and countries

Question 39

What is the overall impact of globalisation on people?

Answer 39

Cost and benefits for all
Poorest tend to gain the least and lose the most, but argued that they would be worse off without it

Provides job opportunites
Income and investments from TNCs

Question 40

What are benefits and cost of globalisation at a local level?

Answer 40

Benefits:
Cheaper products and greater choice
Multicultural
Bigger market
Education improves
Freedom of movement
Spread of tech and ideas
Higher standards of living
Better infrastructure, food, water, health
Gender equality and pay gap close

Cost:
Local business cannot compete
Labor drain
Dependence on TNC for employment (TNC becomes very important-> TNC close many lose jobs)
Worker exploitation
Environmental cost

Question 41

What are benefits and cost of globalisation at a national level?

Answer 41

Benefits:
Higher level of incoming revenue (tourism, exports)
Improved healthcare, infrastructure, social care, education
TNC offer apprenticeships

Cost:
Increased disparity
Many benefits limited to urban areas
TNC control majority of workforce (blacklisting)
Environment impact
Growth of slums

Question 42

What are benefits and cost of globalisation at a international level?

Answer 42

Benefits:
Skilled workers can easily go between countries
Higher income
Higher quality of life
Access to side levels of research and skills
International trade
Foreign investment

Cost:
Loss of biodiversity
Movement of people (usually those who are skilled)
Increased development gap
TNC usually don’t consider local identities

Question 43

What are some benefits presented by TNC to a country?

Answer 43

Brings skills, opportunities, money, tech
Brings investment -> increased development
Infrastructure us improved
Creates jobs (buy more -> more taxes)
Multipliers effect (business creates jobs -> more money spent -> increased profits -> other business employ more -> more spending and taxes -> gouvernement invest -> more business)

Question 44

What are some cost presented by a TNC to a country?

Answer 44

Pays low wages for long hours
General exploitation
TNC -> lots of power -> if they leave can leave economy highly damaged
Leak -> profits are taken to open new businesses
Ignore environmental and social impact
Jobs may not provide any new skills