eco indicators for context Flashcards
what is GNP
gross national product- GDP + income earned from overseas assets minus income earned by overseas residents
value of all product produced by labour and property supplied by the citizens of one country
GNI
income earned by a countries residents and businesses domestically and abroad- GDP + net income from residents overseas
the use and limitations of national income data to compare differences in living standards between countries
- GDP doesn’t give any indication of distribution of income, 2 countries with similar GDP per capita may have different distribution of income -leading to different living standards - doesn’t correctly show standards of living
- GDP dissent demonstrate purchasing power to account fr international price differences
purchasing power- cost of living in each country and inflation rate - hidden economys such as black marker are not accounted for in GDP- misleading - hard to compare
- no indication of welfare, happiness index
importance of PPP exchange rates when making international comparisons of living standards
theory estimates how much exahcnage rate ends ajustusting so that exchange rate between countries is equivalent according to each currency purchasing power.
- cost of living and inflation
e.g. £15,000 ER us and uk is 1.5 £ per $ US car should be $10,0000
helps minimise misleading comparisons between countries
how is standard of living measured in HDI
real GNI at PPP per capita
GNI accounts for remittances and foreign aid
HDI value close to 1 = high eco Development 0= low
very high 0.8
high 0.7-0.79
medium 0.55-0.69
low less than 0.69
limitations of using HDI to compare levels of development between countries over time
- doesn’t consider qual factors, how free people are politically, humans rights, gender equality, human security, cultural identity
- doesn’t rake the enviro and gender equity into account
- doesn’t consider disribution of income
PPP values change quickly, likely to be inaccurate/ misleading
GNP = inaccurate measure of monetary wellbeing, inequitable Deve;opment is not human development
excludes aspects many aspects of eco and social lie that could be regarded as constraining development: crime, corruption, poverty, deprivation, negative externalities
HPI
human poverty index
life expectancy ,education and ability of citizens to meet basic needs
HPI-1, poverty in developing countries,
probability of living to age of 40,
adult literacy rate,
ability of citizens to meet basic needs- % of underweight children and % od people not using improved water sources
HPI 2- poverty in developed
probability of not survive until 60
% of adults do not have literacy skills
poverty- thoes living below poverty line- below 50% median income, long term unemployment rate
GDI
relative inequality between men and women
gender related development
HDI with consideration of gender
differences in life expectancies, income and education between genders
index numbers- measure changes in price level and other eco variables
CPI- Pn/ P0 X 100
P0= price level in base year 9n price in year compared
