PRELIM EXAMINATION Flashcards
The most common way to define developing world is by?
Per capita income or the amount of money earned per person in a nation
Is the process whereby low-income national economies are transformed into modern industrial economies.
Economic development
Countries with high level of economic growth and security.
Developed economies
Countries in the process of changing to a free market or economic system where price are unristricted with minimal government intervention.
Economies in transition
Countries with underdeveloped industrial base and low human development index (HDI)
Developing economies
It is a composition of statistical data, including life expectancy, education, income indicators, which is used to rank countries.
Human Development Index (HDI)
Total domestic and foreign output claimed by residents.
Grodd national income (GNI)
Total final output of goods and services produced by the country’s economy within the country’s territory by residents and non-residents.
Gross domestic product (GDP)
The number of live births and death rate occuring among the population of a nation during a given year
Birth and death rates
The death rate of infants before reach one year of age per 1000 live births in a given year
Infant mortality rate
Quality of health care, level of sanitation, and provision of elderly care
Life expectancy
Percentage of people capable of reading is an indicator of educational state in a given nation
Literacy rate
Measured by life expectancy at birth.
Long and healthy life
Number of years a newborn could expect to live if prevailing paterns of age-specific mortality rates at the time of birth stay the same throughout the infant’s life.
Life expectancy at birth
Measured by combination of average schooling attained by adults and expected years of schooling for school-age children
Knowledge
Number of years of schooling that a child school entrance age can expect to receive if prevailing pattern of age-specific enrollmetn rates persist throughout the childs life
Ecpected years of schooling
Avetagnumbber of years of education received by people ages 25 and older
Mean of years schooling
Measured by real per capita gross domestic product adjusted for the differing purchasing power parity
Decent standard of living
Number of units of a foreign country’s currency required to purchase the identical quantity of goods and services in the local developing country market.
Purchasing power parity
Aggregate income of an economy generated by its production and its ownerahip of factors of production
Gross national income (GNI) Per capita
Formula of health and education dimensions of HDI
Dimension index = actual index- minimum value / maximum value- minimum value
Formula if standard of living/income dimension of HDI
Dimension index= In (actual value) – In(Minimum Value) / In(maximum value) - In(minimum value)
What are the 3 development categories?
Developed, economies in transition, developing
Basic indicators of development
Real income, health and education
Give example of countries under developed countries
Canada, france, germany, greece, ireland, italy, japan, Lithuania, Switzerland, united kingdom, United states
Example of countries in economies in transition
Albania, armenia, belarus georgia, serbia, and Ukraine
Example of countries in developing economies
Colombia, ghana, haiti, Indonesia, lebanon, Malaysia, nepal, south Africa, Thailand, and Philippines
Accoring to him, transition from underdevelopment to development can be described in terms of a series of steps or atages through which the all countries must proceed.
Walt W. Rostow (Rostow’s stage of growth)
In stage of growth, this stage is Dominated by agriculture and barter exchange
Traditional society
This stage is manifested by the development of education and understanding of science, application of science to technology and transport
Pre-take off stage
This stage demonstrated by organized systems of production, positive growth rates in economic sectors, and modernixatoon fo traditional methods and norms.
Take-off
This stage is an ongoing movement towards diverse economy
Drive to maturity
This stage is manifested by citizen enjoying high and rising conaumption per capita/individual
Stage of mass consumption
This growth theory emphasize the importance of saving and investment
Harrod-domar groth model
Units of capital required to produce a unit of output òver a given period of time
Capital-output ratio
Savings expressed as a portion of disposable income over sone period of time.
Net savings ratio
Two ratios affect the rate fo growth
Higher the savings ratio, the more an economy will grow ; the higher the capital-output ratio, the higher the rate growth
Inderdevelopment is due to underutilization of resources arising fron structural or institutional factors that have their origins in both domestics and international dualism.
Structural-change theory
Formulated by laureate W. Arthur lewis, also know as the 2-sector model and surplus labor model.
Lewis model
Formulated by Nobek Laureate W. Arthur lewis, also known as 2-sector model and surplus labor model
Lewis model
Marginal productivity of Agricultural labor is virtually zero
Rural agricultural sector
Exyra output gained by adding one unit of labor when all othe inputs are held constant
Marginal Productivity
Industrial firms make profit that can be reinvested into even mor industrialization, and capitak starts to accumulate. Also could promote hig-paying jobs, create more multiplier product that is being produced.
Urban industrial sector
Investment to subsequent stages of production or product development
Forward linkage
Investment to facilitaties and machinery and equipment taht will complement the stages if production ot product development
Backward linkage
This theory suggest that economic progress would lead to the emergence of a large service sector.
Fisher-clark model
Generally a high income elasticity of demand for services, especially leisure, tpurism, and financial services.
High income elasticity of demand
Productivity in service sector is lower than in the manufacturing sector becasue it is harder to apply new technology to many services
Low productivity of labor
This model state that Underdevelopment exist in developing countries because of the continuing exploitative economic, political and cultural politicies of former colonial rules toward less developed countries
Neocolonial dependence model
This model state that Developing countries have failed to develop because their development strategies have been based in an incorrect model of development
The false-paradigm model
Based on dualism, dualism is the coexistence of 2 situations or phenomena
Dualistic-development thesis
Prices of comodities or services freely rise or fall when the buyer’s demand for the rises or falks or the seller’s supoly of them decrease or increase
Free markets
Also knows as New politicak economy approach. Selft-interet guide individual behavior and that government to be inefficient and corrupt.
Public choice theory
There are many imperfection in the products and market of developing country, government have a key role to play in facilitating the operations of market through “non selective” interventions
Market-friendly approach
This model of economic growthg analyzes changes in the level of output in an econony over time as a result of changes in the population growth rate, saving rate, rate of technological progress
Soloe growth model
What is important to a particular individual or group. Poverty cannot be properly measure by income or even by utility as conventionally understood.
Amartya sen’s capability approach
Father of economics. State should notnimoise any restrictions on freedom of an individual.
Adam Smith’s theory
Assign role to the entrepreneur and innovationin the process of exonomic development
Joseph schumpeter’s theory
Authentic development is more than economic progress, its about development of people as human being.
Principles of the social doctrine of the church
Concerned primarily witht he efficient and lest cost allocation of scarce productive resources, empahsize utility, profit maximization, market efficiency and determination of equilibrium
Traditional economics
Goess beyond traditional economics and includes social and institutional process
Political economy
Deals with thw econokics, social, political and institutional mechanism, both public and private.
Development economics
The total gross national income of a country divided by uts total population
Growth rate of income per capita
Is the monetary growth of GNI per capita minus the rate of inflation
Growth level of “real” per capita gross national income (GNI)
Development in the past has been typically seen in terms of…
Planned alteration of production and employment structures
Principle, standard, or qualities
Social values
State mind of feelings
Popular attitudes
Norms, rule of conduct, and generally accepted ways of doing good
National institutions
Increase in the production of economics goods and services
Reduction of inequality
Economic and humanitarian actions
Eradication of poverty
Core values of development: this inckudes Basic goods and services
Sustenance: the ability to meet basic need
Core valuea of development which includes the feeling of worthiness that a society enjoys.
Self-esteem: to be a person
Core values of development involves society gas a varity of alternatives from which to satisfy it wants and individuals enjoy real choices.
Freedom from servitude: to be able to choose.
MDGs corresponding target
Eradicate the poverty and hunger
Achieve universal primary education
Promote gender equality and empower women
Reduce child morality
Improve maternal health
Combat HIV/AIDS, malaria, and other diseases
Ensure environmental sustainability
Develop a global partnership for development
