POLS 200: Exam 3-TOPICS:8,9,10 Flashcards
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why does development matter?
-civil wars are concentrated in the poorest countries
-the world economic forum argues that deepening income inequality is the #1 contemporary world challenge
-for service provision (e.g. education, health care) which impacts life expectancy & inequality between men & women
-for democracy
_____ argues that deepening income inequality is the #1 contemporary world challenge
the world economic forum
service provision (e.g. education, health care)
which impacts life expectancy & inequality between men & women
development is positively associated with___
persistence of democracy
almost all countries with GDP/Capita above ______ are democracies
$8,000 (1985 PPP)
alsmot all counties with GDP/Capita above $8,000 are democracies-BUT there are exceptions
-larger middle class
-quality of government should be greater
-economic development permits education of more people which builds human capital
the paradox that countries w/ an abundance of natural resources tend to experience things like poor governance, low levels of economic development, civil war and dictatorship
resource curse
resource curse comes from:
Clark, Golder & Golder 2009)
oil, diamonds, a few large landowners dominating the economy
resource curse
development & post materialism
-living well, affluence, security
-frees people up to think about other elements to enhance the quality of their life
>human rights
>a clean environment
>equality across groups
how can you measure levels of development of a country? or how wealthy its people are?
-common measure: gdp/capita\
-purchasing power purity exchange rates (PPP): makes the funds comparable across countries.
based on the price of a particular bundle of goods in each country
PPP
presented w/ the year of the exchange rate because inflation changes the value of country exchange rates over time.
PPP
common explanations for underdevelopment of countries (acemoga 2003)
-lack of functioning markets
-badly educated population
-machinery & technology are outdated or nonexistent
>geographic hypothesis
>institutions hypothesis
possibility of omitted variables or reverse casualty
correlation DOES NOT equal causation
colonization by europeans starting in the 15th century-changed institutions while holding geography constant
acemoga 2003
indicates that geography is not the explanation for lack of prosperity-richest places have become the poorest
acemoga 2003
support for the institutional hypothesis (variation in colonization strategies)
acemoga 2003
analysis of GDP/Capita, climate access to the sea or major waterway, conclusion: geography does make the difference
sachs et. al 2001
3 major ways geography affects economic development:
-ease of transporting a good, people, ideas
-prevalence of disease
-agricultural productivity
sachs et. al 2001
why do some counties maintain institutions associated w/ high rates of poverty?
elites may have a lot to lose from institutional reform & all elites are powerful and can resist change
lukes 2nd dimension of power
power to keep issues off the policy agenda
change in insitituions can occyr when
-groups that favor change can become more powerful
-sociery can strike a bargain w/ those who will lose some power to credibly compensate them after the change occurs (acemoga)
the budget (in a country) needed to uy a certain amount of calories, plus some other indispensable purchase”
povertyly
a poor person is essentialy defined as someone w/o enough to eat
banerjee & dalfo 2007
poor countries governments have verty little moneg to put towards addressing social policy needs
sachs et al. 2001
the more elastic the tax base, the greater the degree to which the sovereign had to give control over public policy to those whose money he sought to appropriate for public purposes
bates 1991
-this gives maquilas strong negotiating power, they can exit
-but the need for skilled labor can change the equation
-globalization thesis
challenges for developing human capital
-there need to be jobs in the county for the people w. the skills
-the government needs to know what skills industry needs
focus on the set of countries where development has failed
-most are small countries in population & the size of their contribution to the world economy and their lack of economic growth does not drag down average growth in the world
-countries with:
>lower life expectancy
>higher infant mortality
>higher % of children w/ symptoms of long-term malnutrition
the bottom billion (collier 2007)
4 types of development traps (collier 2007)
-conflict trap-civil war
-natural resources trap
-trap of being landlocked with bad neighbors
-trap of bad governance
the global market has gotten far more hostile to new entrants than it was in the 1980’s
collier 2007
natural resources trap (collier 2007)
discovery of a new natural resource due to boom & bust cycles, the country may end up pooer
austerity policies may improve the economy but the public views the policy as harmful & blame the government and international lending agencies that imposed the reforms
collier 2007
terrible governance and policies can destroy an economy with alarming speed
collier 2007