Factors Affecting Growth And Development

Question 1

What are the 4 development traps (as identified by Paul Collier)

Answer 1

• conflict (external and internal)
• reliance on natural resources
• landlocked with bad neighbours
• bad governance

Question 2

Challenges facing landlocked countries

Answer 2

-unable to integrate in global change (high costs)

Question 3

What landlocked countries have been doing economically well

Answer 3

Ethiopia - they have been able to achieve regional economic integration with other land-locked nations

Question 4

Key barriers to growth

Answer 4

• infrastructure gaps
• export dependency
• macro instability
• conflict / corruption
• human capital weakness
• inequality
• resource depletion

Question 5

How is gender inequality as a barrier to development

Answer 5

Unequal opportunities

Women are limited by pregnancy / poverty / early marriage

Question 6

Key factors behind low female enrolment

Answer 6

• social norms / discrimination
• high cost of schooling
• information failures about the benefit of impact
• securities worries

Question 7

Roles of many women in less developed countries

Answer 7

In the informal economy - family businesses. No/little pay.

Question 8

Zambia human capital facts

Answer 8

1/3 adults have experienced secondary information

Primary school drop-out rate is nearly 50%

Question 9

Malnutrition as a barrier to development

Answer 9

Brain development impacts

Child deaths

Question 10

Strategies to reduce incidence of malnutrition

Answer 10

• spending on nutrition education
• gov subsidies for grain prices
• targeting cultural norms (girls can only eat after boys)
• infrastructure spending

Question 11

What does the Harrod Domar Model of Growth show

Answer 11

That the rate of growth depends on:

• level of national saving
• productivity of capital investment
• capital-output ratio

Question 12

Constraints on the Harrod-Domar Model

Answer 12

• savings gaps
• human capital weakness
• investment and natural resource depletion

Question 13

Role of higher savings

Answer 13

Increase in savings leads to an increase in net investment = larger capital stock = rise in GDP/GNI = increased factor incomes

Question 14

Significance of a domestic savings gap

Answer 14

• savings needed to fund investment
• high levels of poverty makes it impossible to generate savings to provide funds to fund investment projects (savings gap)

Question 15

Where can external finance come from

Answer 15

• overseas development assistance (aid)
• FDI
• remittance inflows
• private sector debt inflows

Question 16

Long-term importance of capital investment for developing countries

Answer 16

-injection of demand for capital goods industries

Question 17

What do institutional failures include

Answer 17

Failure of: systems of
Health
Education
Political
Legal
Financial