Theme 4 - Economic development Flashcards
What is the human development index?
A measure of development that takes into account the 3 most important indicators
What are the 3 factors HDI measures?
- Education
- Health
- Living standards
What is the IHDI measure of economic development?
The inequality human development index takes into account inequality distribution in an economy.
What is the multidimensional poverty index?
This measures the percentage of the population that is multidimensional poor. It uses data from HDI factors breaks them down into smaller categories
3 main advantages of HDI?
- Measures the 3 most important factors
- It is a good comparative measure
- Fairly reliable measure as many countries use it
3 main disadvantages of HDI?
- Only looks at income, doesn’t consider other factors
- Ignores distribution of development
- Other factors have become more important over time that HDI doesn’t consider
What is the genuine progress indicator?
It is calculate from 26 different indicators grouped in social, environmental and economical.
How can a lack of education lead to a reduction in growth and reduced development?
Lack of human capital which means low skilled labour therefore reducing productivity. This restrains growth from low AD and restrains development from low govt tax revenues
What government intervention can be used to increase human capital?
Build new schools:
- Increased investment in human capital so better skills and increase high paid jobs, increases productivity and growth
- Increased govt tax revenues so increased spending on development
What are some problems of investing in new schools?
- Poor countries may lack funding for spending
- More people going school means fewer people working in poor countries and so growth and development is constrained
How can a lack of infrastructure refrain growth and development?
- Fewer jobs, less disposable income, less consumption and so growth
- Higher costs, higher prices, reduced competitiveness, less corporation tax
How can a lack of infrastructure refrain growth and development?
- Fewer jobs, less disposable income, less consumption and so growth
- Higher costs, higher prices, reduced competitiveness, less corporation tax
What strategy could a country use to improve infrastructure?
- promotion of FDI
- This could be from a prompt of lower corporation tax revenues so investors from other countries invest or by reducing wage costs such as the eradication of the minimum wage
- Countries can expand, be more competitive and increase tax revenues for the government.
What could be some issues with promotions of FDI?
Reducing wage costs means there are less incomes, fall in Consumption of AD, Lower corporation tax so less growth and development
- Lower tax rates means less revenue for the government
How can poor health lead to a lack of growth and development?
- Poorer countries have bad facilities and lack of staff
reduces workers productivity which refrains growth
Less government tax revenue and therefore profits - Poor sex education means more people are likely to develop health problems etc
What strategy could be used to help restore health in a country?
AID. This could then be spent in improving the number of hospitals, staffing and facilities. More labour are well enough to obtain jobs
- Could also help spend money on educating children on sex
What could be a constraint of AIDs as a strategy of development?
Corruption in the government. Governments may obtain finances to personal gains
Population growth means more people out of work to look after children
How can population growth prevent growth and development?
More people out of work to look after their children. They may take lower income jobs.
Means less disposable income therefore lower consumption from AD. This may decrease growth and restrict tax revenues for development
- Poorer quality healthcare and education
How could population growth be managed used a strategy?
More spending on Education.
If countries have people with better human capital, then more will get higher paid jobs and therefore will be more unlikely to have more children. This therefore may prevent huge increases in population growth. especially for women so that have fewer children from being more career driven
- Improving education on sex
What are some reasons that spending on education may not beneficial to reducing population growths?
Potentially religious beliefs that prevent the use of people using contraception.
How can corruption lead to a reduction in growth and development?
Tax revenues and AID (public funds) could be spent by governments for private gain. This therefore means that less money is available for the public to benefit from
