The changing economic world Flashcards
What is development?
The process of a country’s economic growth, advancement in technology and improving welfare, which ultimately makes its people’s quality of life better.
What is the global development gap?
the difference between a more and less developed country
Give and describe examples of social and economic measurements of development:
-GNI per capita: the country’s GNI divided by its population.
-Death rate: how many people die per 1000 per year.
-Birth rate: how many live babies are birthed per 1000 per year
-Infant mortality rate: how many babies die before turning 1 per 1000 babies born
-Literacy rate: how many adults who have the ability to read and write
-Life expectancy: the mean age which a country’s population live up to
-People per doctor: how many people allocated to one doctor (abundance of doctors and medical services)
-GDP: the total value of the products and services a country produces.
-GNI: the total value of the products and services produced by a country including overseas income.
-HDI: a measurement based on several measurements of development (life expectancy, education level and income per head)
Why might measurements of development not be accurate?
Individual measurements develop faster than others so a country may seem more developed than in reality, to avoid this we use several measurements or use a country’s HDI.
State and explain how we categorise countries economically:
HICs- these are countries with a high GNI per capita over $12,000. these are very wealthy with a population with a high standard of living, quality of life is high.
NEEs- are countries with GNI per capitas between $1,200 and $12,000. they are becoming wealthier as their industries are progressing from primary to secondary sectors, quality of life is improving.
LICs- these are countries who have low GNI per capita’s of below $1,200, they are poor with low quality of lives.
Why is basing a country off of their GNI per capita only an inaccurate source of their development?
GNI per capita are the total value of a country’s generated income from products and services divided by the population. this average often excludes inequalities in a country’s wealth, for example the wealthiest in a country may make a population seem overall rich, ignoring the majority in poverty.
What is the DTM?
Demographic Transition Model- a graph that shows how death and birth rate correlates to a country’s development.
Describe the DTM’s Stage 1 and explain how it correlates to a country’s development:
birth rate:
they are fluctuating and high because people have primary sector jobs which require manual labour (like farming), so having more children helps them be more productive and earn an income. high infant mortality rates also mean that in order for some children to survive (and perhaps help care for their parents when they grow old) parents must have many to ensure some live. there may also be a lack of education about family planning and contraceptives may be unavailable.
death rate:
they are fluctuating and high because disease is common (poor hygiene and improper food security or clean water supplies). there is a lack of health care so people can’t get treated and due to them having more manual and laborious jobs, they are exposed to more sickness and declines in health. war also can cause death rates to be high
the population remains low
this reflects LICs
Describe the DTM’s Stage 2 and explain how it correlates to a country’s development:
birth rate:
birth rates still remain high and fluctuating.
death rate:
these dramatically drop due to advancements in medicine (more vaccines, drugs and doctors are supplied)
population starts to grow
Here the LIC s developing
Describe the DTM’s Stage 3 and explain how it correlates to a country’s development:
birth rate:
they start to decline rapidly because more secondary jobs require less manual labour, industrialisation and the mechanisation of industries makes companies more machine dependant. food production is more stable and available so less famine and disease is common so infant mortality rates drop, so parents don’t need to have many children to ensure their survival.
better education about family planning and contraceptives are supplied and government incentives may limit the size of families to reduce population growth. sanitation and water supply has also improved.
death rate:
decreases slower
population increases but leads to a plateau
Describe the DTM’s Stage 4 and explain how it correlates to a country’s development:
birth rate:
is low and fluctuating
death rate:
lower than birth rate and fluctuating
population is stable
Describe the DTM’s Stage 5 and explain how it correlates to a country’s development:
birth rate:
they undergo another decline due to the emancipation of women who are becoming more career orientated so have less desires for children.
death rate:
may increase above birth rates due to the aging population
the population starts to decrease.
What are the three categories that cause uneven development in the world? (blurt out main points)
physical (water quality/supply)
historical (colonisation)
economic (global trading patterns/ economy based on primary products)
Explain a physical factor which causes uneven development:
water supply:
if a country is constantly in water stress or a water deficit, this means that there is less water available to irrigate crops and create products in manufacturing industries which means that the country cannot produce and export optimally meaning their economy cannot grow. this reduces development as this means governments cannot invest enough money to further develop their country. additionally, if people are constantly searching for water sources, they cannot work or be educated, limiting their potential to earn more and better their life quality.
water quality;
if water is contaminated, people may refrain from basic hygiene or resort to using poor quality water which risks water borne diseases (like malaria). this prevents people from going work or school so they are less likely to earn an income and support the production in industries.
Explain a historical factor which causes uneven development:
colonialism:
some countries (such as those in Africa) had previously been colonised by mire developed European countries such as Britain. these countries had exhausted others from their raw natural materials and governed their economies to better profit their own. this lead to many African countries being very underdeveloped by the time they gained independence as they were left with less natural wealth and slave trade left them with a less productive population.
Explain an economic factor which causes uneven development:
debt:
many countries borrowed money from others in the 1960-70’s, the debt they owe had grown from years of interest, meaning these countries now have to focus majority of their money repaying the debt before it grows, this means more money is redirected away from the country’s own development
global trade patterns:
if a country has poor trade links, they have less connections to other countries to export goods to and earn revenue into the economy. this means that there is less money earned to enable development
having a primary based economy:
many LICs export raw materials from primary sector industries such as agriculture, selling these goods at a raw state results in less income as they are less valued so the country doesnt earn much profit as these raw materials also fluctuate in value, sometimes being more expensive to produce than to export. when a country then buys the products manufactured from their raw materials, they often lose money as these products are higher in value. this reduces the country’s ability to develop. wealthier countries also can force these raw materials to become cheaper, further disabling development.
State and describe the 3 consequences of uneven development:
disparities in health: highly developed countries will have better healthcare as their government has been able to invest in better medicines and a better supply for doctors (through better higher education), this results in them having higher life expectancies and lower infant mortality rates.
disparities in wealth: higher developed countries will be richer as the country is able to supply a better quality education for the youth to take up jobs in tertiary and quaternary sectors where they can earn more money to better their quality of life.
international migration: if a less developed country borders a more advanced one, people are likely to migrate to the more developed one to seek out a better quality of life (provided with better education, healthcare and employment opportunities).
What are the ways in which we can reduce the development gap?
Aid
Free trade
Investment and Industrial development
Intermediate technology
Fair trade
Debt relief
Microfinance loans
Explain and evaluate how aid reduces the development gap:
Aid is when a country receives money or resources from a charity or foreign government to fund development projects, for example by constructing schools to improve literacy rates or by supplying farmers with more advanced equipment and knowledge to improve agriculture. this enables a country to develop as they are able to earn more money through the jobs they become more suitable for and the produce they export. However, once these resources / money run out, development can be halted if locals aren’t educated on its sustenance.
Evaluate how free trade reduces the development gap:
Free trade is when countries agree to not charge tariffs or quotas meant to restrict trade with other countries to enable poorer countries to trade with the rest of the world. this helps some LIC’s to earn a better revenue from their products as they receive fairer prices for their labour, helping them improve their standards of living. However, most LICs export raw primary products that aren’t worth much to HICs who can reduce these prices, making the system unfair as the LIC cannot earn much from foreign trade.
Evaluate how Investment and industrial development reduces the development gap:
Foreign direct Investments (FDIs) can invest in a country by either buying property or investing in the development of a country’s infrastructure. this helps the country access better finance, expertise and technology bringing in better infrastructure and services which helps develop industries. With industries being more developed, the country is able to employ more people in the secondary sector, bringing better opportunities to having higher paying jobs that can help locals afford a better life quality, additionally the government receives more money through tax to invest further into the multiplier effect. Transnational companies (TNCs) may be sources of investment as they may establish plantations in LICS/NEES which brings more employment, however, these jobs are easily exploited due to the lack of development, resulting in many being under paid for their labour and can often be damaging to the environment.
Evaluate how Intermediate technology reduces the development gap:
Intermediate technology is when tools, machines or systems are provided to help improve services (mostly to do with health, water or farming)of a country. these are affordable, easy to operate and maintainable. for example, by providing farmers with machinery, they require less manual labour which makes agriculture more productive and reliable, so populations can have a stable source of food, improving their quality of life. However, some cases involve lending locals loans to buy these tools on offer, this often makes locals stressed as they must repay the loan before interest increases their debt decreasing their quality of life.
Evaluate how fair trade reduces the development gap:
the fair trade movement aims to help poor farmers to receive fairer prices for their produce often by making buyers pay extra to increase their wages. This allows poorer farmers in LICs to afford to better their quality of life, for example they can use the extra money to send their children to school. fair trade also helps improve a community’s healthcare, enabling it to develop. However, only a tiny portion of these extra prices are received by the poor farmers, with the majority being paid towards the retailer to boost their profit. there are also some speculation that Fair trade doesn’t buy products from the poorest farmers or countries.
Evaluate how debt relief reduces the development gap:
Debt relief is when a country is relieved of its previous debts which enables them to focus their revenue on the multiplier effect of their country. Many countries can now redirect the money saved up to fund development in their infrastructure, resources and industry which ultimately improves their quality of life. However, some countries may try to take advantage of this, by taking out more loans and increasing their debt thinking that it will be ruled out in the future, this often leaves them with more debt to repay, disabling them from directing their money towards the development of their education or healthcare. some corrupt governments may not use the money saved to improve the country’s quality of life so issues such as poverty don’t get resolved.
