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Global Business Environment > economic development and poverty (class 5) > Flashcards

economic development and poverty (class 5) Flashcards

1
Q

what is economic development?

A

Economic development: refers to the economic well-being of the people in a nation. It is usually measured by GDP per capita of economies and it reflects the standard of living of the people within those economies.

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2
Q

how is economic development usually measured?

A

GDP per capita

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3
Q

what does economic development reflect?

A

the standard of living of the people

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4
Q

what is the region with the highest gdp per capita?

A

North America

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5
Q

what are the 2 regions hat consistently have the lowest gdp per capita?

A

sub-saharan african and South Asia

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6
Q

what is the second region with the higest gdp per capita?

A

European Union

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7
Q

true or false: gdp per capita has been increasing everywhere since 2013

A

false: latin-america, europe and central asia, middle east and north africa have not

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8
Q

in 2023, what were the regions with the higest gdp per capita after North America and the eu?

A

latin america and east Asia

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9
Q

what are the regions that have tjeir gdp per capital growing the fastest?

A

east asia & pacific and South Asia

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10
Q

what is the hdi?

A

The Human Development Index (HDI) defines economic development as the elimination of poverty and unemployment as well as an increase in income.
It is a measure of development based on:

  1. A long and healthy life – life expectancy at birth
  2. Knowledge – measured by adult literacy rate combined with primary, secondary and tertiary gross enrolment ratio.
  3. A decent standard of living as measured by GDP per capita (PPP US$).
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11
Q

what is the hdi measured with?

A
  1. A long and healthy life – life expectancy at birth
  2. Knowledge – measured by adult literacy rate combined with primary, secondary and tertiary gross enrolment ratio.
  3. A decent standard of living as measured by GDP per capita (PPP US$).
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12
Q

what were the top hdi countries in 2022?

A

mostly European
1. switzerland
2. norway
3. iceland
4. hong kong
5. Sweden
5. denmark
6. ireland
6. germany
7. singapore
8. Netherland

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13
Q

what were the bottom hdi countries in 2022?

A

all african expect Yemen
somalia
South Sudan
Central African Republic
niger
chad

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14
Q

true or false: every region in the world has had its hdi increase since 1990

A

true

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15
Q

what regions have their hdi above the world average?

A

OECD, europe & Central Asia, east asia & the pacific, Latin America

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16
Q

what regions have their hdi below the world average?

A

arab states, south asia, sub-saharan africa

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17
Q

what are the regions with the higgets life expectancy at birth in 2022?

A

European Union, north america, east asia & pacific

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18
Q

true or false: all regions have a higher life expectancy at birth now then in 2010?

A

false: North America

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19
Q

true or false: south asia’s life expectancy at birth is higher than in sub-saharan africa

A

true

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20
Q

what are the regions with the lowest literacy rate?

A

sub-saharan africa
south asia
middle east and Northern Africa

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21
Q

what are the poorest regions in the world?

A

sub-saharan africa (36%) and south asia (10%)

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22
Q

what was the sdg target 1.1?

A

“By 2030, eradicate extreme poverty for all people everywhere, currently measured as people living on less than $1.25 a day.”

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23
Q

why has it been difficult to reach the sdg target 1.1?

A
  • It is estimated that the number of extreme poor increased by about 70 million in 2020.
  • Close to 11 percent more people lived in extreme poverty in 2020 compared to 2019. Since then, an uneven economic recovery, rising food prices, and conflict among some of the world’s biggest food producers have stalled progress further.
  • As a result, it has become more difficult to reach SDG target 1.1 of ending poverty by 2030 unless the poorest countries grow at rates not seen before.
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24
Q

will we reach the sdg target 1.1?

A

no, current projections suggest that in 2030, 574 million people, equivalent to nearly seven percent of the world’s population, will remain in extreme poverty.

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25
Q

in 1990, how many people lived below the poverty line?

A

around 2 billion

26
Q

in 2019, how many people lived below the poverty line?

A

660 million

27
Q

how did the percentage of people in extreme poverty change between 1990 and 2019?

A

38% to 8.5%

28
Q

what is a problem from the optimism of the figures about the reduction in extreme poverty worldwide?

A

the large reduction at the global level masks uneven progress at the regional level

29
Q

in 1990, where were most of the extreme poor located?

A

east asia and South Asia

30
Q

between 1990 and 2019, where did extreme poverty decrease significantly?

A

east asia & pacific and south asia, due to strong economic growth

31
Q

where did the number of people in extreme poverty increase between 1990 and 2019?

A

sub-saharan africa (rapid growth of population)

32
Q

what is africa’s gdp in world gdp?

A

GDP (2032 billion) is only 1.93% of world’s GDP (2023). (less than france’s gdp)

33
Q

how many countries are there in africa?

A

54 un members

34
Q

what is the contrast between africa’s gdp and population?

A

GDP (2032 billion) is only 1.93% of world’s GDP (2023). But its population accounts for 18,6% of the world’s population (1.521 billion, September 2024).

35
Q

how much does africa represent in world trade?

A

2,6%

36
Q

how much does africa receive of global fdi inflows?

A

3.5%

37
Q

true or false: intra-african exports were less than with europe and asia

A

true: Intra-African exports were 15% of total trade in 2022, compared with 23.6% with Europe, 32,2% with Asia, 3,4% with North America and 9% with the Middle East.

38
Q

true or false: since 2000, gni per capita in east asia & pacific has been increasing a lot more than south asia and sub-sahran africa

A

true

39
Q

true or false: since 2000, gdp per capita in east asia & pacific has been increasing a lot more than south asia and sub-sahran africa

A

true

40
Q

what are the countries with the highest % of population living in extreme poverty (2017)?

A

malawi
rwanda
tanzania

41
Q

how have poverty rates been since 1990?

A

falling everywhere (middle east started increasing in 2014)

42
Q

true or false: not all african countries have low gdp

A

true (seychelles, Mauritius, Gabon)

43
Q

why has africa’s general economic performance been slow?

A
  • economic structure
  • scarce physical capital and investment
  • weakened human capital
  • low social capital
  • bad governance
44
Q

what is th economic structure of africa?

A
  • Very little diversification
    • Reliance on primary commodities with volatile prices (agriculture and commercial fishing, natural resources, resource curse, textiles)
    • Low ability to weather economic shocks
  • Dependence on extreme and unpredictable weather conditions (droughts and floods)
  • Until this century, very little integration with the international economy (Trade protectionism; Capital controls)
45
Q

what do we mean by scrace physical capital and investment

A
  • high risk (low quantity and quality of infrastructures and low quality of institutions)
  • little or no savings: (people: too poor to save, financial systems too slow, weak institutions; government: unsustainable fiscal deficits)
  • low fdi (expection of a few countries, due in part to restrictive trade policies)
  • dependence on international aid (used for both private and public projects)
46
Q

what are the problems with africa’s infrastructure?

A

africa’s annual infrastructure financing needs: $93 billion
actual annual infrastructure needs: $45 billion
population with access to paved roads: 34%

47
Q

what are the areas in africa with the lowest fdi inflows?

A

south africa
northern africa
sub-saharan africa

48
Q

what is the area that receives the most net official development assistance and official aid?

A

sub-saharan africa and then the middle east and North Africa

49
Q

has the net offical development assistance and official aid received increased since the 1990s?

A

yes

50
Q

why does africa have weakened human capital?

A

quantity: large population below 15 years of age, precarious health situation (high incidence of infectious and parasitical diseases, which leads to great inefficines because of savings going into drugs and family members having to take care of the sick)
quality: low rate of literacy, precarious health situation

51
Q

which countries are in the bottom hdi?

A

all african besides Yemen

52
Q

what are the regions with the highest % of population aged 0-14?

A

sub saharan africa (decreasing over time)
middle east and north africa (steady)
south asia (decreasing over time)

53
Q

what is the region with the highest prevalence of hiv?

A

sub-saharan africa (by far, in 2021 it was 3.5%)

54
Q

what are the regions with the lowest primary completion rate?

A

sub-saharan africa
middle east & North Africa (it used to be south asia in second)

55
Q

why does africa have low social capital?

A
  • ethnic diversity (lack of trust in domestic trading, discrimination)
  • due to political bopundaries drawn by former colonial masters (low sense of national identity)
56
Q

what do we mean by bad governance in africa?

A
  • political instability (armed conflicts and transitional regimes)
  • low qualty institutions (high transaction costs because of arbitrary enforcement of property, corruption and trade protectionism; incompetence)
  • poor infrastructure and public services
  • unsustainable external indebtedness
  • high inflation
57
Q

what were the mdgs?

A

eight millenium development goals

58
Q

how are the sdgs going?

A

most of them are stagnated, some of them are moderatly improving

59
Q

what happened after covid in terms of gender equality?

A

According to the World Economic Forum, women needed to wait 99 years to achieve full equality with men before the pandemic arrived. Now, after COVID-19, they will need to wait 136 years.

60
Q

what are some of the potential solutions for africa’s problems?

A
  • Increase international aid to undertake necessary reforms (argument made by Jeffrey Sachs), but only if there is good governance (Stable macroeconony, quality institutions and infrastructure, and low corruption)
  • Economic, trade and monetary integration (African Union, COMESA, EAC, ECOWAS, IOC, SACU, SADC, UMA.), but intra-African trade remains low (14.4%; 2023) because of protectionism and low-quality institutions
  • Democratization (Accountability, transparency, better governance)
  • Trade liberalization for agricultural products (Access to developed countries (Doha Round), Liberalization of African trade regimes)
61
Q
A

Global Business Environment (21 decks)

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