Exam 2 Flashcards
Surplus labor would mean all of the following except
diminishing returns to labor
In the first turning point (or the Lewis Turning Point) in the Lewis model
wages rise in the agricultural sector
Which of the following characterizes Botswana?
Botswana has little government corruption
Engel’s Law explains in part why as economies grow, the agricultural contribution falls because Engel’s Law states that
as income increases, the proportion spent on food falls
Sectors in which the government should intervene, according to the linkages-balanced growth literature are all the export sectors.
FALSE
Lucas model of human capital or education may not be applicable to LDCs because of
“brain drain”
China allowed market forces to play a role in its development in
EPZs (export processing zones), town & village enterprises, dual track system
The ratio of the number of people below the poverty line to the total population is the
headcount index
If everyone in a country had the same level of income, then the value of the Gini concentration ratio would be:
0.0
The ratio of the number of people below the poverty line to the total population is the
head-count index
Kuznets’ inverted-U hypothesis states that income inequality___________ during the early stages of development and then___________ as per capita income rises.
rises; falls
The following indicator measures the depth of poverty
poverty gap
A small subsidy to the poorest of the poor lowers the ____________ but May not lower the _____________
poverty gap; headcount index
balanced growth
focus on all sectors
unbalanced growth
focus on a few sectors (leading) to increase growth
