“I speak positively about others.

ECONOMICS CHAPTER 1; DEVELOPMENT

NOTES

Points to remember:

• Infant Mortality Rate: It indicates the number of children who die before the age of one year as a
proportion of 1000 live children born in that particular year.
• Net Attendance Ratio: Net Attendance Ratio is the total number of children of age group 14 and 15
attending school as a percentage of the total number of children in the same age group.
• Literacy Rate measures the proportion of the literate population in the 7 years and above age group.
• BMI: Body Mass Index. BMI= Weight (in Kg)/ Height in metres squared
• Middle East has the largest stock of crude oil in the world.
• Formula to calculate per capita income= National income/ Total Population
• UNDP: United Nations Development Programme
• HDI: Human Development Index.
• UNDP compares countries based on the people’s educational level, health status, and per capita income.
The index used by UNDP is called Human Development Index. It includes life expectancy, per capita income,
and adult literacy (15+).
• World Bank: It compares countries based on per capita income.
• Development means change(s) over a period of time. It comprises social, political, economic, and
administrative elements. Developed and developing economies always aim at development, i.e. change
for the better.
• Due to the unequal distribution of resources and income, Middle East countries (Bahrain, Jordan, Kuwait,
etc.) are not considered rich.

Questions and Answers:

Q1. What do you understand by the indicators of development?

Ans. Indicators of development refer to all those parameters that help in measuring the levels of development.
a. They help in making comparisons.
b. e.g. National income, Per Capita Income, Life expectancy, literacy rate, etc.

Q2. What contributes to human development?

Ans. Many economic as well as non-economic factors contribute to human development-
Living a long and healthy life.

a. To have education, information, and knowledge.

b. Enjoying a decent standard of living.
c. Enjoying basic rights like freedom, security, education, etc.
d. To have equality and enjoyment of human rights.
Q3. What is meant by economic development? Enlist the indicators of development.
OR Explain two basis to measure the economic development of a country.
Ans. Economic development means a long-term increase in per capita income along with a rise in the standard
of living.
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a. National income and per-capita income show the levels of economic development. The higher the
income, the higher will be the levels of economic growth.
b. National income: It is defined as the total value of all the goods and services produced within a
country and the income coming from abroad.
c. Per capita income: Per capita income is the average income of the people of a country during a year.
It is calculated by using the following formula –
Per capita income= National income/Total Population

Q4. What do you understand by human development?

Ans. Human development is a human-centered approach to development.
a. It helps people to live a happy, purposeful, and creative life of their choice.
b. It covers the rich and poor.
c. It is also concerned with the well-being of the people and considers their needs, choices, and
aspirations.

Q5. Why do you think average income (or per capita income) is an important criterion for development? OR
Why is per capita income used as an indicator to compare countries? Are there any limitations to their
usage?
Ans. We use an average because of the following reasons:
a. Countries have different populations. So, comparing the total income will not state what an average
person is likely to earn.
b. National income does not notify whether people in one country are more prosperous than others in
different countries.
c. We compare the average income (which is the total income of the country divided by its total
population) as it helps in telling how much an average person is likely to earn.

Limitations to using an average

a. It is a useful method to draw out conclusions based on income, however, it hides disparities too.
b. The average income does not mention the distribution of income among the people of a country.

Q6. Mention the principal criteria used by the World Bank in classifying different countries. Give examples.
Ans. In the World Development Report brought out by the World Bank, the criterion of per capita income or
average income is used in classifying countries.
a. Countries with a per capita income of US $12,736 or more per annum and above in 2013 are called rich
countries.
b. Countries with a per capita income of US$ $1,045 or less per annum or less in 2013 are called low-
income countries.
c. Example: India falls in the category of low-middle-income countries because its per capita income in
2013 was just US$ 1570 per annum. The rich countries excluding Middle East countries and certain
small countries are generally called developed countries.

Q7. “The earth has enough resources to meet the needs of all but not enough to satisfy the greed of even
one person” Explain this statement.
Ans. According to this statement made by Mahatma Gandhi, the resources are available in plenty to satisfy
everyone’s needs but, in our greed, and hurry to develop, we exploit them recklessly.
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a. Resources are important for any developmental activity but irrational consumption and
overutilisation of resources may lead to socio-economic and environmental problems.
b. The exploitative nature of modern technology and insatiable individuals are the root cause of
resource depletion at the global level. This acts as a hindrance in the path of development.
c. Accumulation of resources in the hands of a few divides the society into rich and poor.
d. Overutilisation causes the depletion of resources to satisfy the greed of the affluent.
e. Resources are limited but our wants are uncontrolled. Hence, we have to use the resources
judiciously and adopt developmental measures to sustain them.

Q8. “People have different development goals.” Justify.

Ans. People have different development goals because:
a. Life situation(s)of every individual is different.
b. They seek things that are important to them, i.e. something that can fulfill their desires or aspirations.
c. Development for one may not be the development for another.
d. For development, people look at a mix of goals. E.g. A girl from a rural family would want respect as
well as freedom whereas a girl from a rich family might want better education and income.
e. E.g. A landless rural labourer would wish to have more days of work and better wages, whereas a
prosperous farmer would wish to have a higher family income through higher support prices for his
crops.

Q9. What is Sustainable Development? Why is it important?

Ans. Sustainable development: Development takes place without damaging the environment while not
compromising the needs of future generations.
Sustainable development is important because:

a. The stock of natural resources is limited. Resources are limited and our wants are unlimited. Hence,
we have to use the resources judiciously and adopt sustainable development measures.
b. The growth of all countries is dependent upon natural resources and if completely exhausted, could
negatively affect the economic growth of all the nations. E.g. Fossil fuels.
c. Excessive mining of iron, coal, gold, silver, and extraction of crude oil leads to the gradual depletion
of their stock.
d. Burning of natural resources causes environmental hazards and sustainable development aims
towards pursuing development in a healthy way that must not harm nature.
e. Smoke and other injurious emissions from industries/factories and the means of transport lead to the
pollution of the environment.

Q10. What can be done to achieve sustainability in development?

Ans. Measures to achieve Sustainable Development:
a. Preventing exhaustion of crude oil and groundwater etc., conserving trees, and developing our
resources judiciously and wisely.
b. Conservation of forest and wildlife resources.
c. Controlling pollution, excessive mining, etc.
d. Develop alternate resources. E.g.- Biofuels, Plant-based plastics (made from agricultural scrap), etc.
e. Adopting measures like rainwater harvesting using environment-friendly ways.
f. Adopting the 5Rs approach- Refuse, Reduce, Reuse, Repurpose, and Recycle.
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Q11. Find out the present sources of energy used by people in India. What could be the possibilities fifty years
from now?
Ans. The following sources of energy are used by people in India:

Coal Diesel Petrol Kerosene Oil Nuclear Power Natural Gas Electricity Bio Gas

After 50 years

a. Shortage- There is a great likelihood that India will face a crisis in some sources of energy such as
petroleum and its products.
b. Rising prices- The rising prices of oil and its related articles will become a burden for everyone.
c. Alternatives- India will have to use non-conventional sources of energy as alternatives. E.g. Nuclear
energy, Tidal energy, Solar energy, Wind energy, and Geothermal energy.

Q12. Why is groundwater overused? Can there be development without its excessive use?
Ans. Groundwater is overused due to-
a. Large and growing population of cities.
b. More water requirement for commercial crops.
c. Due to urbanization and industrialisation.
Although groundwater is a renewable resource, its overuse will lower the water table which will result in
scarcity of groundwater for the present as well as future generations.
There can be development without its overuse by adopting the following methods:
a. Rainwater harvesting.
b. Watershed development, which also helps in the development as well as conservation of water
resources.

Q13. What should India do or achieve to become a developed country?

Ans. India should adopt the following measures to target development -

a. Control the growing rates of population.

b. Increase the pace of industrialisation.
c. Promotion to exports.
d. Take measures to eradicate the problems of poverty.
e. Reduce the inequalities of income and wealth.
f. Reduce losses in public sector enterprises.
g. Provide basic facilities i.e. health, education, water, transport, etc. to all sections of society.

Q14. Besides income, what can be the other attributes to compare economic development?
Ans. Other attributes to compare economic development:
a. Educational levels of the people and their health status are considered measures to compare the
economic development of a nation.
b. Infant Mortality Rate (IMR): This indicates the number of children that die before one year as a
proportion of 1,000 live children born in that particular year.
c. Literacy Rate: This measures the proportion of the literate population in the 7 years and above age
group.
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d. Net Attendance Ratio: This is the total number of children of age group 14 and 15 attending
school as a percentage of the total number of children in the same age group.
e. Life Expectancy at birth: It denotes the average expected length of life of a person at the time of birth.

Q15. What is meant by ‘Infant Mortality Rate’ (IMR)? Give two main reasons for low IMR in Kerala.
Ans Infant Mortality Rate (IMR) is the number of deaths of infants under one-year-old per 1,000 live births.

Reasons for low IMR in Kerala:

a. Provision of basic health amenities.

b. Provision of proper educational facilities.
c. Proper functioning of Public Distribution System (PDS)

Q16. What do you mean by public facilities? Why are they important?
Ans. Public facilities are the facilities required for the society for leading a better quality of life. These are
provided by the government. E.g. Defence, Government schools, Railways, Street lights, police etc.

They are important because:

a. These are available at a low cost or at free of cost so that even poor people can avail of such facilities.
b. The benefits of public facilities can be shared by many people.
c. These facilities are provided and maintained by the government as an enormous amount of money is
required and those are not very profitable enterprises.

Q17. Why is crude oil essential?

Ans. Crude oil is essential due to the following reasons:

a. It acts as raw material for a variety of products E.g. plastics, detergents, etc.
b. It emits very less smoke thereby helping in running industries and automobiles etc.
c. It provides fuel for heat and lighting and lubricant for machinery.
d. Petroleum byproducts like kerosene, LPG, etc., are used in chemical, textiles, pharmaceuticals, and
other industries.
e. It is a source to generate electricity.

Q18. What factors other than income are important aspects of ourlife? Explain. OR
Give some examples where factors other than income are important to us.
Ans. Income is very essential for satisfying the basic requirements of life. But money in your pocket cannot buy
everything. Hence, there are factors other than income that are important aspects of human life.
a. Education plays a vital role
b. An individual would like to work at a place where she feels safe.
c. Equal treatment, freedom, and respect for life are also important.
d. The quality of life depends upon non-material things.
e. E.g. Health, Security, etc.

Q19. ‘Money in your pocket cannot buy all the goods and services that you may need to live well.’ Explain the
statement with three examples.
Ans. Money cannot –
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a. buy the quality of our life that depends upon non-material things like equal treatment, freedom,
security, respect for others, etc.
b. provide a pollution-free environment, happiness, peace, etc.
c. give facilities like schools, colleges, parks, and hospitals that an individual cannot afford. All these are
to be provided by the government/society.
d. guarantee us a type of government that takes decisions for the welfare of the common people.
e. ensure unadulterated medicines, unless we can afford to shift to one such community that already has
all these things.

Q20. People have different and conflicting developmental goals. Explain with suitable examples.
Ans. Two persons or groups may seek conflicting things:
a. Different people can have different development goals that eventually result in different making ofgoals.
b. What may be developed for one may not be developed for the other. It may even be destructive for
the other.
c. E.g. A girl expects as much freedom and opportunity as her brother and that he also shares in the
household work. Her father may want her to learn household chores and get married.
d. To get more electricity, industrialists may want more dams. But this may submerge the land and disrupt
the lives of people who are displaced- such as tribals. They might resent this and may prefer small check
dams or tanks to irrigate their land.

Q21. Differentiate between renewable and non-renewable resources.

Ans. Differences between renewable and non-renewable resources are:

RENEWABLE RESOURCES NON-RENEWABLE RESOURCES

Can be renewed or reproduced by physical, The resources which once used cannot be easily
chemical, or mechanical processes replenished are called non-renewable resources.
Divided as continuous or flow and biological Divided into recyclable and non-recyclable.
resources.
E.g.: Solar and wind energy, forest, wildlife, water E.g.: Minerals and fossil fuels etc.
etc.
Available in abundance. Occur over a long geological time.
Regeneration is generally done through natural Not replenished by natural means within a useful
processes within a useful time frame. time frame.

Q22. The help example shows two groups that may have different notions of (or on) development.

Ans. It is certainly true that development for one may not be developed for the other.

a. More wages mean development for a worker, but it can go against the entrepreneur. E.g. A rich farmer
or trader wants to sell food grains at a higher price but a poor worker wants to purchase them for low
prices.
b. Construction of a dam means more and cheap power, but people, who will lose their habitat, will
demonstrate. E.g. To get more electricity, the industrialists may want more dams. But this may
submerge the agricultural land and disrupt the lives of the people.
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Q23. What is the significance of the Human Development Index?

Ans. The significance of the Human Development Index:
a. HDI is used to measure the level of development of a country.
b. It has been published by UNDP and according to it, countries have been ranked.
c. It is a comprehensive approach that covers all the major aspects of life including- education,
health status, life expectancy, etc., which are considered for measuring the economic
development of a nation.

Q24. ‘Human development is the essence of social development.’ Explain.

Ans. Human development is the essence of social development.
a. Focuses on improving the quality of life - to lead a long and healthy life, to have education,
information, and knowledge, to have opportunities for livelihood, etc.
b. It is concerned with the well-being of the people, their needs, and aspirations.
c. Human development focuses on the expansion of basic choices.