1

UNIT 3- General Characteristics and Structure have made the lives of the people more
of Developing Countries miserable. A large bulk of population of these
countries lives below the poverty line.
A. Classification of Developing Countries
The recent estimates reveal that about 35
According to:
per cent of India population (i.e. about 320 million
1. United Nations (UN) people) lives below the poverty line, that is, they
are unable to get even sufficient calories of food
-44 least developed, 88 developing nations, 13 needed for minimum subsistence, not to speak of
petroleum-rich members of the Organization of minimum clothing and housing facilities. The
Petroleum Exporting Countries (OPEC) situation in other developing countries is no
-145 countries constitute the Third World better.

2. Organization for Economic Cooperation and The poverty in the under-developed

Development (OECD) countries is due to stagnation or lack of economic
growth in the past and their technological
-61 low-income countries (LIC’s), 73 middle- backwardness, despite the vast resources
income countries (MIC’s), 11 newly industrializing existing there. By utilizing their natural resources
countries (NIC’s), 13 member of OPEC and making progress in technology they can
increase their production and income and break
3. International Bank for Reconstruction and
the vicious circle of poverty operating in them.
Development (IBRD)
It may however be noted that after the
-also known as “World Bank”
Second World War and with getting political
-101 (low-income, middle-income, upper-middle- freedom from colonial rule, in a good number of
income), 24 high-income economies the under-developed countries the process of
growth has been started and their gross domestic
 Low income economies are those with a product (GDP) and per capita income are
GNI per capita of USD 1,025 or less increasing. That is, why they are now called the
 Lower-middle-income economies are developing countries or less developed countries
those with a GNI per capita of USD1026- (LDCs) But it will take a long time before they are
4035 able to catch up with the present-day developed
 Upper-middle-income economies are countries.
those with a GNI per capita of USD 4036-
12475 2. Excessive Dependence on Agriculture:
 High-income economies are those with
An under-developed country is generally
GNI per capita of USD 12,476 or more
predominantly agricultural. About 60 to 75% of
B. Characteristics of Developing Economics their population depends on agriculture and its
allied activities for its livelihood. Further, about 30
An idea of the characteristics of an to 50 percent of national income of these
underdeveloped or a developing economy must countries is obtained from agriculture alone.
have been gathered from the above analysis of
the definitions of an underdeveloped economy. This excessive dependence on agriculture
Various developing countries differ a good deal is the result of low productivity and backwardness
from each other but even then there are some of their agriculture and lack of modern industrial
common features which are present in almost all growth. In the present-day developed countries,
the developing economies. the modern industrial growth brought about
structural transformation with the proportion of
We explain below some of the basic and working population engaged in agriculture falling
important characteristics which are common to all drastically and that employed in the modern
developing economies: industrial and services sectors rising enormously.
1. Low-Per Capita Income or Poverty: This occurred due to the rapid growth of the
modern sector on the one hand and tremendous
The first important feature of the rise in productivity in agriculture on the other.
underdeveloped countries is their low per capita
income.
It may however be noted that the extent of
poverty prevailing in the developing countries is
not fully reflected in the per capita income which
is only an average income and also includes the
incomes of the rich also. Large inequalities in
income distribution prevailing in these economies
 2

In developing countries today, despite necessities of life, leaving a very little margin of
their modern industrial growth in the last four income for capital accumulation.
decades not much progress has been achieved
Even with an increase in the level of individual
towards structural transformation in the
incomes in an under-developed economy, there
occupational structure of their economies. Due to
does not usually follow a higher rate of
the use of highly capital-intensive techniques in
accumulation because of the tendency to copy
their industries very few employment
the higher levels of consumption prevailing in the
opportunities have been created in their industrial
advanced countries. Nurkse has called this as
sector.
“demonstration effect”. It is usually caused
When increasing population cannot obtain through media like films, television or through
employment in the modern non-agricultural foreign visits.
occupations, such as industry, transport and other
Generally, there exist large inequalities in the
services, then the people remain on land and
distribution of incomes in under-developed
agriculture and do some work which they are able
countries. This should have resulted in a greater
to get.
volume of savings available for capital formation.
This has resulted in excessive But most often the sector in which the greatest
dependence on agriculture. During the last some concentration of incomes lies is the one which
decades because of population explosion the derives its income primarily from non-
pressure of manpower on land in the developing entrepreneurial sources such as unearned
countries has increased very much. Many bad incomes of rents, interests and monopoly profits.
results have followed from this. With the increase
The attitudes and social values of this sector are
in man-land ratio the land has been divided into
often such that it is prone to use its income for
small holdings.
‘conspicuous consumption’, investment in land
3. Lack of Capital and Low Rate of Capital and real estate, speculative transactions,
Formation: inventory accumulation and hoarding of gold and
jewelry. If these surpluses are channeled into
The insufficient amount of physical and human
productive investment, they would tend to
capital is so characteristic a feature in all
increase substantially the level of capital
underveloped economies that they are often
formation.
called simply ‘capital-poor’ economies. One
indication of the capital deficiency is the low 4. Rapid Population Growth and Disguised
amount of capital per head of population. Unemployment:
Not only is the capital stock extremely small, but The diversity among under-developed economies
the current rate of capital formation is also very is perhaps nowhere to be seen so much in
low. In most under-developed countries evidence as in respect of the facts of their
investment is only 5% to 8% of the national population in respect of its size, density and
income, whereas in the United States, Canada, growth. While we have examples of India and
and Western Europe, it is generally from 15 per Pakistan with their teeming millions and galloping
cent to 30 per cent. rates of population growth, there are the Latin
American countries which are very sparsely
The low level of capital formation in an under-
populated and whose total population in some
developed country is due both to the weakness of
cases numbers less than a single metropolitan
the inducement to invest and to the low
city in India and China.
propensity and capacity to save. The rate of
saving in developing countries is low primarily In several newly emerging countries of Africa too
because of the low level of national income. and in some of the Middle Eastern countries the
size of their population cannot be regarded as
In such an economy, the low level of per capita
excessive, considering their large expanse. The
income limits the size of the market demand for
South-East and Eastern Asia, on the other hand,
manufacturing output which weakens the
have large populations.
inducement to invest. The low level of investment
also arises as a result of the lack of dynamic However, there appears to be a common
entrepreneurship which was regarded by measure, namely, a rapid rate of population
Schumpeter as the focal point in the process of increase. This rate has been rising still more in
economic development. recent years, thanks to the advances in medical
sciences which have greatly reduced the death
At the root of capital deficiency is the shortage of
rate due to epidemics and diseases.
savings. The level of per capita income being
quite low, most of it is spent on satisfying the bare While the death rate has fallen sharply, birth rate
does not yet show any significant decline so that
 3

the natural survival rate has become much larger. An important feature of developing economies,
In countries like India, Pakistan, Burma, a especially those which are marked by surplus
veritable population explosion is feared. The great labour is that they have a dualistic structure. This
threat of this important trend consists in this is dualistic character of these economies has been
that it sets at bought all attempts at development held to be the cause of unemployment and under-
inasmuch as the increased output is swallowed employment existing in them.
up by the increased population.
Keeping in view this dualistic structure of less
One important consequence of this rapid rate of developed economies, important models of
population growth is that it throws more and more income and employment have been propounded.
people on land and into informal sector to eke out Famous Lewis model of economic development
their living from agriculture, since alternative with unlimited supplies of labour and Fei-Ranis
occupations do not simultaneously develop and model of “Development in a Labour Surplus
thus are not there to absorb the increasing Economy” explain how in dualistic economies, the
numbers seeking gainful employment. unemployed and underemployed labour in the
traditional sector is drawn into a modern high
The resultant pressure of population on land and
productivity sector.
in informal sector thus gives rise to what has
been called “disguised unemployment”. Disguised The concept of dualism was first of all introduced
unemployment means that there are more into the development analysis by Dr. J.H. Boeke
persons engaged in agriculture than are actually but he emphasized the social dualism, according
needed so that the addition of such persons does to which there is sharp contrast between the
not add to agricultural output, or putting it social systems characterizing the two broad
alternatively, given the technology and sectors of the economy, one in which the original
organization even if some of the persons are social system with its subsistence or pre-capitalist
withdrawn from land, no fall in production will nature, limited wants, non-economic behavior and
follow from such withdrawal. As a result, marginal low level of economic and social welfare prevails,
productivity of a wide range of labour employed in and the other where imported capitalist system
agriculture is zero. with its modern system of industrial organization,
wage employment, unlimited wants and positive
Under-utilization of Natural Resources:
behavior to economic incentives exists.
The natural resources in an under-developed
However, it is technological dualism rather than
economy are either unutilized or underutilized.
Boeke’s social dualism which has an important
Generally speaking, underdeveloped countries
bearing on the problem of economic growth and
are not deficient in land, water, mineral, forest or
surplus labour in the developing countries.
power resources, though they may be untapped.
According to the concept of technological
In other words, they constitute only potential
dualism, the important difference between the
resources. The main problem in their case is that
traditional and the modern sectors lies in the
such resources have not been fully and properly
difference between the production techniques or
utilized due to various difficulties such as
technologies used.
shortage of capital, primitive technology and, the
small size of the market. In the small modern sector consisting of large-
scale manufacturing and mining which provides
Economic Backwardness of the People:
wage employment, highly capital-intensive
The people in under-developed countries are techniques imported from the developed
economically backward, that is, the quality of the countries are used. On the other hand, in the
people as productive agents is low. Instead of large traditional sector covering agriculture,
acquiring the greatest possible control over their handicrafts and allied activities, in which there
physical environment, the people have struck a exist extended family system and self-
balance with nature at an elementary level. employment, labour-intensive technology is
generally used.
They have been relatively unsuccessful in solving
the economic problem of man’s conquest of his As a result of the difference in technologies used,
material environment. Particular manifestations of the labor productivity and levels of earnings in the
this are low labour efficiency, factor immobility, modem sector are much higher than those in the
limited specialization in occupations and in traditional sector. Moreover, since the technology
trades, and a lack of entrepreneurship, illiteracy, used in the modern sector is highly capital-
ignorance, and conservative social values that intensive, the growth of this sector has not
minimize the incentives for economic change. absorbed adequate amount of labour in high
productivity and high wage employment.
5. Dualistic Structure of the Underdeveloped
Economies:
 4

With the explosive rate of growth of population There is ample evidence in the world of the fact
and labour force and the limited creation of that when nations cannot solve their domestic
employment opportunities in the modem sectors problems, their governments plunge them into
because of the highly capital-intensive war with their neighbors who may be prosperous.
technology, surplus la-bour has emerged in the It is thus in the interest of world peace and
agriculture and services. It has been possible for harmony that the poor countries are enabled to
agriculture to contain the surplus labour because remove or reduce their poverty.
of the prevalence of extended family system in
There is a growing and legitimate desire of the
which both work and income are shared by the
poor nations to eradicate poverty. The desire to
family members.
develop is keenly felt by different sections of their
We thus see that the problem of unemployment population. Their desire to develop is natural and
and under-employment in less developed understandable because they experience acute
economies has been intensified by the physical sufferings as a result of appallingly
technological dualism caused by the use, in the miserable economic conditions in which they live.
modem manufacturing and mining, of capital- The masses in the poor countries constantly face
intensive technology imported from abroad which hunger, illiteracy, sickness and forced to eke out
is wholly unsuitable to the factor endowments of a life of extreme poverty.
these less developed economies with abundant
Note that, according to the new view, economic
labour and small capital.
development is needed mainly for two reasons:
The unemployment and under-employment in
(1) The removal of poverty,
these less developed economies are not only due
to the slow growth of capital or low rate of (2) Enlargement of human capabilities and
investment, it is also due to the highly capital- freedoms.
intensive techniques used in the modem sector.
For the removal of poverty capabilities of the poor
This technological dualism with the fact that should be enhanced so that they should be able
modem sector has limited labour-absorptive to meet their minimum basic needs which include
capacity contains important implications for getting adequate food, health, clothing and
development strategy to be framed for less shelter. To achieve these economic growths is
developed countries like India with surplus labour. necessary but not sufficient.
6. Need for Development: Therefore, for removal of poverty, direct anti-
poverty measures such as generation of enough
There is a very urgent need for economic
employment opportunities be taken. Secondly, as
development in the under-developed or poor
emphasized by Amartya Sen, development is
countries. Economic development is needed so
needed so that people should enjoy freedom and
that living standards of their people may be
life of valued functioning. To quote Amartya Sen,
raised. What is more important is that economic
“The valued functioning may vary from
development of the poor countries is necessary
elementary ones, such as being adequately
from the point of view of the richer countries.
nourished and being free from avoidable diseases
What do we find today? The world is divided into to very complex activities or personal states such
two parts: one of the poor and the other rich as being able to take part in the life of community
which is continuously becoming richer. Such a and having self respect”. Thus, according to
situation threatens the economic and political Amartya Sen, freedom of choice, or control of
stability of the world. Unless the poor countries one’s own life are central aspects of well-being for
are enabled to share the general prosperity, their which true development is needed.
condition will become more and more difficult.
Times are gone when people believed in their
It is the relative difference between the rich and destiny or kismet. They are no longer prepared to
poor countries which will make the poor countries reconcile to their poverty as resulting from fate.
contented or discontented. Ever-increasing They have now realized that the solution of the
discontent in the poor countries is bound, sooner problem of poverty lies in economic development.
or later, to aggravate the already explosive
This realization has been further strengthened by
situation in the world.
the ever-increasing contacts and communications
As the gulf between the rich and poor countries between such countries and the developed
widens, the tension in the world will grow. The countries. The awareness of the possibilities of
poor countries will agitate more and more for a development is growing every day. Already, the
share in prosperity and, consequently, their upper sections of society in developing countries
demand on the richer countries will grow louder are imitating the living standards prevalent in the
and louder in volume and intensity. rich countries.
 5

The desire for development has followed the

political freedom of the many poor countries from
foreign rule. It has now been realized that political
freedom without economic freedom and
prosperity has no meaning.
Political independence has naturally raised
expectations of the people in the economic
sphere. No wonder that people of these countries
which have won freedom from the colonial rule
aspire to develop economically and that in the
shortest possible time.
Other Characteristics 9. High levels of international debt:
1. Low income per head: Many poor countries have borrowed heavily in the
past. In some cases, a large proportion of the
People in developing countries are poorer on an
country’s income is taken up for repaying (and
average, than those in developed economies.
paying interest on) foreign loans. This means it
However, this does not mean that all the people
cannot be used to spend on education, health
are poor. In fact, some can be very rich.
care and investment. So, the opportunity cost of
2. Low levels of saving due to low income: repaying debt may be economic development.
Poor people cannot afford to save and so the 10. Reliance on the export of primary
savings ratio (saving as a percentage of products:
disposable income) of a country, where the
Over a period of time, the price of primary
average income is low, is likely to be low.
products tends to fall, relative to the price of
3. Low life expectancy and high infant manufactured goods and services. This means
mortality rate: that some poor countries receive relatively less
for their exports whilst having to pay more for
Someone born in Japan can expect to live up to their imports. Over the last fifty years, a range of
the age of 83 whereas someone born in commodity prices, including copper, coffee, cocoa
Zimbabwe has a life expectancy of 37 years only. and coal have been falling.
4. Low levels of education and health care: A number of primary product markets are
These tend to result in low levels of productivity. dominated by the consuming countries and these
developed countries use their buying power to
5. Low levels of capital goods and poor keep down the prices of primary products. There
infrastructure: have also been significant fluctuations in the price
These again reduce productivity. of some primary products due to climate changes
and natural resources.
6. Poor housing and sanitation:
11. Lack of investment in human capital and
A significant number of people may not have capital goods:
access to clean water for drinking and washing.
Lack of expenditure on education, training and
7. Relatively high number of workers, capital goods holds back- increases in
employed in the primary sector: productivity, introduction of new technology and
international competitiveness.
Underemployment can be high in agriculture. For
instance, ten persons may be doing the work of 12. Emigration of key workers:
six. This, again, lowers productivity.
Doctors, nurses, teachers, managers and other
8. Concentration on a narrow range of exports key workers may seek better paid employment
(most of which are primary products): abroad. Since 1999, for instance, more medical
staff have emigrated from Ghana, than the
Developing countries can be subject to, what is
country has been able to train. Most of these
known as, the
have emigrated to Canada, the UK and USA.
underdevelopment trap or the vicious circle of
13. Trade restrictions on their products:
poverty- This is the problem, that a country with
low incomes has a low saving rate. This means Tariffs, other restrictions and foreign government
that most of their resources are used to produce subsidies on their own products, make it difficult
consumer goods. The lack of capital goods keeps for developing countries to sell their products at
productivity and income low, as shown in Fig. 1. home and abroad, on equal terms.
 6

The steepest tariffs tend to be imposed by relationship between a country's size, its level of
developed economies on those products, which per capita national income, and the degree of
developing economies concentrate on, including equality or inequality in its distribution of that
agricultural produce and labour-intensive income.
manufactured goods. These tariffs also build up
Even excluding the wealthy OPEC states, India,
as the goods are processed into higher value-
with a 1993 population of over 900 million, had a
added goods, so that developing economies are
1990 per capita income level of $350, while
discouraged from building up their industries.
nearby Singapore, with fewer than 3 million
14. Unbalanced economies: people, had a 1990 per capita income of over
$12,300.
Certain markets may be underdeveloped such as
the financial sector. A lack of a developed 2. Historical Background
financial sector is likely to discourage saving and
Most African and Asian nations were at one time
investment.
or another colonies of Western European
C. The Structure of Third World Economies countries, primarily Britain and France but also
Belgium, the Netherlands, Germany, Portugal,
Any portrayal of the structural diversity of
and Spain. The economic structures of these
developing nations requires an examination of
nations, as well as their educational and social
seven critical
institutions, have typically been modeled on those
components: of their former colonial rulers. Countries like those
in Africa that only recently gained their
1. The size of the country (geographic area, independence are therefore likely to be more
population, and income) concerned with consolidating and evolving their
2. Its historical and colonial background own national economic and political structures
than with simply promoting rapid economic
3. Its endowments of physical and human development. Their policies (e.g., the rapid
resources Africanization of former colonial-held civil service
jobs) may consequently reflect a greater interest
4. The relative importance of its public and private
in these immediate political issues.
sectors
Perhaps more important, the European colonial
5. The nature of its industrial structure
powers had a dramatic and long-lasting impact on
6. Its degree of dependence on external the economies and political and institutional
economic and political forces structures of their African and Asian colonies by
their introduction of three powerful and tradition-
7. The distribution of power and the institutional shattering ideas: private property, personal
and political structure within the nation taxation, and the requirement that taxes be paid
Let us briefly consider each component, focusing in money rather than in kind. As we will discover
on some similarities and differences among later, these ideas combined to erode the
countries in Africa, Asia, and Latin America. autonomy of local communities and to expose
their people to many new forms of potential
1. Size and Income Level exploitation.
Obviously, the sheer physical size of a country, In Latin America, a longer history of political
the size of its population, and its level of national independence plus a more shared colonial
income per capita are important determinants of heritage (Spanish and Portuguese) has meant
its economic potential and major factors that in spite of geographic and demographic
differentiating one Third World nation from diversity, the countries possess relatively similar
another. Of the 145 developing countries that are economic, social, and cultural institutions and
full members of the United Nations, 90 have face similar problems. In Asia, different colonial
fewer than 15 million people, 83 fewer than 5 heritages and the diverse cultural traditions of the
million. Large and populated nations like Brazil, indigenous peoples have combined to create
India, Egypt, and Nigeria exist side by side with different institutional and social patterns in
small countries like Paraguay, Nepal, Jordan, and countries such as India (British), the Philippines
Chad. Large size usually presents advantages of (Spanish and American), Vietnam (French), and
diverse resource endowment, large potential Indonesia (Dutch).
markets, and a lesser dependence on foreign
sources of materials and products. But it also 3. Physical and Human Resources
creates problems of administrative control,
A country's potential for economic growth is
national cohesion, and regional imbalances. As
greatly influenced by its endowments of physical
we shall see in Chapter 5, there is no necessary
resources (its land, minerals, and other raw
 7

materials) and human resources (both numbers different for countries with large public sectors
of people and their level of skills). and ones with sizable private sectors. In
economies dominated by the public sector, direct
The extreme case of favorable physical resource
government investment projects and large rural
endowment is the Persian Gulf oil states. At the
works programs will take precedence, whereas in
other extreme are countries like Chad, Yemen,
private- oriented economies, special tax
Haiti, and Bangladesh, where endowments of raw
allowances designed to induce private
materials and minerals and even fertile land are
businesses to employ more workers might be
relatively minimal.
more common. Although the problem of
In the realm of human resource endowments, not widespread unemployment may be
only are sheer numbers of people and their skill
similar, the solution can differ in countries with
levels important, but so also are their cultural
significant differences in the relative importance
outlooks, attitudes toward work, and desire for
of the public and private sectors.
self-improvement.
5. Industrial Structure
Moreover, the level of administrative skills will
often determine the ability of the public sector to The vast majority of developing countries are
alter the structure of production and the time it agrarian in economic, social, and cultural outlook.
takes for such structural alteration to occur. This Agriculture, both subsistence and commercial, is
involves the whole complex of interrelationships the principal economic activity in terms of the
between culture, of tradition, religion, and ethnic occupational distribution of the labor force, if not
and tribal fragmentation or cohesion. Thus, the in terms of proportionate contributions to the
nature and character of a country's human gross national product. Farming is not merely an
resources are important determinants of its occupation but a way of life for most people in
economic structure (see Chapter II), and these Asia, Africa, and Latin America. Nevertheless,
clearly differ from one region to the next. there are great differences between the structure
of agrarian systems and patterns of land
4. Relative Importance of the Public and
ownership in Latin America and Africa. Asian
Private Sectors
agrarian systems are somewhat closer to those
Most Third World countries have mixed economic Latin America in terms of patterns of land
systems, featuring both public and private ownership, but the similarities are lessened by
ownership and use of resources. The division substantial cultural differences.
between the two and their relative importance are
It is in the relative importance of both the
mostly a function of historical and political
manufacturing and service sectors that we find
circumstances. Thus, in general, Latin American
the widest variation among developing nations.
and Southeast Asian nations have larger private
Most Latin American countries, having a longer
sectors than South Asian and African nations.
history of independence and, in general, higher
The degree of foreign ownership in the private
levels of national income than African or Asian
sector is another important variable to consider
nations, possess more advanced industrial
when differentiating among LDCs. A large
sectors. But in the 1970s and 1980s, countries
foreign-owned private sector usually creates
like Taiwan, South Korea, Hong Kong, and
economic and political opportunities as well as
Singapore greatly accelerated the growth of their
problems not found in countries where foreign
manufacturing output and are rapidly becoming
investors are less prevalent. Often countries like
industrialized states. In terms of sheer size, India
those in Africa with severe shortages of skilled
has one of the largest manufacturing sectors in
human resources have tended to put greater
the Third World, but this sector is nevertheless
emphasis on public-sector activities and state-run
small in relation to the nation's enormous rural
enterprises on the assumption that limited skilled
population. Table 2.2 provides information on the
manpower can be best used by coordinating
distribution of labor force and gross domestic
rather than fragmenting administrative and
product (GDP) between agriculture and industry
entrepreneurial activities.
in 17 developing countries, the United States, and
The widespread economic failures and financial the United Kingdom. The contrasts among the
difficulties of many of these public concerns in industrial structures of these countries is striking,
countries such as Ghana, Senegal, Kenya, and especially in terms of the relative importance of
Tanzania raise questions, however, about the agriculture.
validity of this assumption. As a result, these and
In spite of common problems, therefore. Third
other African nations have moved in recent years
World development strategies may vary from one
toward less public and more private enterprise.
country to the
Economic policies, such as those designed to
promote more employment, will naturally be
 8

next, depending on the nature, structure, and East; or the landlords, moneylenders, and
degree of interdependence among its primary, wealthy industrialists of Asia—most developing
secondary, and tertiary industrial sectors. The countries are ruled directly or indirectly by small
primary sector consists of agriculture, forestry, and powerful elites to a greater extent than the
and fishing; the secondary, mostly of developed nations are.
manufacturing; and the tertiary, of commerce,
Effective social and economic change thus
finance, transport, and services.
requires either that the support of elite groups be
6. External Dependence: Economic, enlisted through persuasion or coercion or that
Political, and Cultural the elites be pushed aside by more powerful
forces. Either way, and this point will be repeated
The degree to which a country is dependent on
often throughout this book, economic and social
foreign economic, social, and political forces is
development will often be impossible without
related to its size, resource endowment, and
corresponding changes in the social, political, and
political history. For most Third World countries,
economic institutions of a nation (e.g., land tenure
this dependence is substantial. In some cases, it
systems, forms of governance, educational
touches almost every facet of life. Most small
structures, labor market relationships, property
nations are highly dependent on foreign trade
rights, the distribution and control of physical and
with the developed world. Almost all small nations
financial assets, laws of taxation and inheritance,
are dependent on the importation of foreign and
and provision of credit).
often inappropriate technologies of production.
This fact alone exerts an extraordinary influence
on the character of the growth process in these
Video Clips:
dependent nations.
1. Characteristics of Developing Countries
But even beyond the strictly economic
https://www.youtube.com/watch?
manifestations of dependence in the form of the
v=MauZwxPEF88
international transfer of goods and technologies is
2. Structural features of developed and
the international transmission of institutions (most
underdeveloped countries
notably systems of education and governance),
https://www.youtube.com/watch?
values, patterns of consumption, and attitudes
v=gDtuK9lMfsk
toward life, work, and self. Later chapters show
3. Why Some Countries Are Poor and Others
that this transmission phenomenon brings mixed
Rich https://www.youtube.com/watch?
blessings to most LDCs, especially to those with
v=tEe_QTNPffU
the greatest potential for self-reliance. A country's
4. Third World vs First World Countries -
ability to chart its own economic and social
What's The Difference?
destiny is significantly affected by its degree of
https://www.youtube.com/watch?
dependence on these and other external forces.
v=1yKvwOydZFw
7. Political Structure, Power, and Interest
Groups
In the final analysis, it is often not the correctness
of economic policies alone that determines the
outcome of national approaches to critical
development problems. The political structure and
the vested interests and allegiances of ruling
elites (e.g., large landowners, urban industrialists,
bankers, foreign manufacturers, the military, trade
unionists) will typically determine what strategies
are possible and where the main roadblocks to
effective economic and social change may lie.
The constellation of interests and power among
different segments of the populations of most
developing countries is itself the result of their
economic, social, and political histories and is
likely to differ from one country to the next.
Nevertheless—whatever the specific distribution
of power among the military, the industrialists,
and the large landowners of Latin America; the
politicians and high-level civil servants in Africa;
the oil sheiks and financial moguls of the Middle