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Economic Development

The document discusses economic development, efficiency, equity, and market failures. It defines economic development as transforming simple economies into modern industrial economies. Efficiency means avoiding waste, while equity means fairness. Market failures occur when the free market does not efficiently allocate resources, and include public goods, spillovers, inequality, market power, and instability. The document provides examples and definitions for these key economic concepts.

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James Ezra Evangelio
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Download as PDF, TXT or read online on Scribd
161 views

Economic Development

The document discusses economic development, efficiency, equity, and market failures. It defines economic development as transforming simple economies into modern industrial economies. Efficiency means avoiding waste, while equity means fairness. Market failures occur when the free market does not efficiently allocate resources, and include public goods, spillovers, inequality, market power, and instability. The document provides examples and definitions for these key economic concepts.

Uploaded by

James Ezra Evangelio
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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MGT 1116

ECONOMIC
DEVELOPMENT
James Ezra Valdez-Evangelio
Presentation
Overview
Topics to Discuss
- Efficiency and Equity
- Market Failures and a Glimpse of the Future
Public Goods and Services
Spillovers
Inequity
Market Power
Instability

ECONOMIC DEVELOPMENT
ECONOMIC DEVELOPMENT
the process whereby simple, low-
income national economies are
transformed into modern industrial
economies.
(Myint and Kruger, 2016)
Efficiency Equity
is the ability to avoid wasting the quality of being fair and
materials, energy, efforts, money, impartial.
and time in doing something or
in producing a desired result.
Economic
Efficiency
is when all goods and factors of
production in an economy are
distributed or allocated to their most
valuable uses and waste is eliminated
or minimized.
(Barnier, 2020)
https://www.investopedia.com/terms/e/economic_efficiency.asp
Economic
Equity
is the concept or idea of fairness in economics,
particularly in regard to taxation or welfare
economics. More specifically, it may refer to equal
life chances regardless of identity, to provide all
citizens with a basic and equal minimum of income,
goods, and services or to increase funds and
commitment for redistribution.
(Bird, 2009)
https://en.wikipedia.org/wiki/Equity_(economics)#cite_note-ODI2-1
MARKET FAILURES
AND A GLIMPSE OF
THE FUTURE
Market Failure
is the economic situation
defined by an inefficient
distribution of goods and
services in the free market.
(Boyle, 2020)
https://www.investopedia.com/terms/m/marketfailure.asp
TYPES OF MARKET FAILURES
PUBLIC GOOD INEQUALITY MARKET POWER
AND SERVICES Market power refers to a
is the unequal
The free-rider problem company's relative
distribution of
can happen when ability to manipulate the
enough people can
income and
price of an item in the
enjoy a good or service opportunity marketplace by
without paying for the between different manipulating the level of
cost to supply it groups in society. supply, demand or both.

SPILLOVERS
ECONOMIC INSTABILITY
occur when a transaction
generates a benefit occurs when the factors that influence an economy are out of

(positive externality) or balance. When an economy becomes unstable, there is

cost (negative externality) inflation, which is a decrease in the value of money. This

on a party not directly leads to higher prices, higher unemployment rates, and

involved in the transaction. general angst among consumers and businesses that are
trying to survive financially.
VOTE WISELY.

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