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Chapter 1 Introducing Economic Development

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189 views

Chapter 1 Introducing Economic Development

Uploaded by

Ruthchell Ciriaco
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© © All Rights Reserved
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You are on page 1/ 17

Chapter 1

Introducing
Economic
Development:
A Global
Perspective

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


1.1 How the Other Half Live

When one is poor, she has no say in public, she feels inferior. She has
no food, so there is famine in her house; no clothing, and no progress
in her family.
—A poor woman from Uganda

For a poor person everything is terrible—illness, humiliation, shame.


We are cripples; we are afraid of everything; we depend on everyone.
No one needs us. We are like garbage that everyone wants to get rid
of.
—A blind woman from Tiraspol, Moldova

Life in the area is so precarious that the youth and every able person
have to migrate to the towns or join the army at the war front in
order to escape the hazards of hunger escalating over here.
—Participant in a discussion group in rural Ethiopia

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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1.1 How the Other Half Live

When food was in abundance, relatives used to share it. These days of hunger,
however not even relatives would help you by giving you some food.
—Young man in Nichimishi, Zambia
We have to line up for hours before it is our turn to draw water.
—Mbwadzulu Village (Mangochi), Malawi
[Poverty is] . . . low salaries and lack of jobs. And it’s also not having
medicine, food, and clothes. --Discussion group, Brazil
Don’t ask me what poverty is because you have met it outside my house. Look
at the house and count the number of holes. Look at the utensils and the
clothes I am wearing. Look at everything and write what you see. What you
see is poverty. —Poor man in Kenya
A universal theme reflected in these seven quotes is that
poverty is more than lack of income – it is inherently
multidimensional, as is economic development.

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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1.2 Economics and Development Studies

– The Nature of Development Economics


• Greater scope than traditional neoclassical economics
and political economy.
– Why Study Development Economics? Some
Critical Questions
– The Important Role of Values in
Development Economics

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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Figure 1.1 World Income Distribution

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1.2 Economics and Development Studies

• Economies as Social Systems: The Need to


Go Beyond Simple Economics
• Social Systems
– Interdependent relationships between economic and non-
economic factors
• Success or failure of development policy
– Importance of taking account of institutional and structural
variables along with more traditional economic variables

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1.3 What Do We Mean by Development?

• Traditional Economic Measures


– Gross National Income (GNI)
– Income per capita
– Utility of that income?
• The New Economic View of Development
– Leads to improvement in wellbeing, more broadly understood
• Amartya Sen’s “Capability” Approach
– Functionings as an achievement
– Capabilities as freedoms enjoyed in terms of functionings
– Development and happiness
– Well being in terms of being well and having freedoms of choice
– “Beings and Doings”:

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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Some Key “Capabilities”

Some Important “Beings” and “Doings” in Capability to


Function:
Being able to live long
Being well-nourished
Being healthy
Being literate
Being well-clothed
Being mobile
Being able to take part in the life of the community
Being happy – as a state of being - may be valued as a
functioning

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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1.3 What Do We Mean by Development?
(cont’d)

• Three Core Values of Development


– Sustenance: The Ability to Meet Basic
Needs
– Self-Esteem: To Be a Person
– Freedom from Servitude: To Be Able to
Choose

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Figure 1.2 Income and Happiness:
Comparing Countries

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1.3 What Do We Mean by Development?
(cont’d)

• The Central Role of Women


– To make the biggest impact on development,
societies must empower and invest in women
• The Three Objectives of Development
– Increase availability of life-sustaining goods
– Raise levels of living
– Expand range of economic and social choices

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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1.4 The Millennium Development Goals

• Millennium Development goals (MDGs)


– Eight goals adopted by the United Nations in
2000
• Eradicate extreme poverty and hunger
• Achieve universal primary education
• Promote gender equality and empower women
• Reduce child mortality
• Improve maternal health
• Combat HIV/AIDS, malaria, and other diseases
• Ensure environmental sustainability
• Develop a global partnership for development

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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Table 1.1 Millennium Development Goals and
Targets for 2015

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Table 1.1 Millennium Development Goals and
Targets for 2015 (cont’d)

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1.5 Conclusions

• The importance of Development Economics


• Inclusion of non-economic variables in
designing development strategies
• Achieving the Millennium Development
Goals
• “…One future-or none at all”

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Concepts for Review

• Absolute Poverty • Gross national income


• Attitudes (GNI)
• Capabilities • Income per capita
• Developing countries • Institutions
• Development • Less developed countries
• Development economics (LDCs)
• • Millennium Development
Freedom
• Goals (MDGs)
Functionings • More developed countries
• Globalization (MDCs)
• Gross domestic product • Political economy

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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Concepts for Review (cont’d)

• Self-esteem
• Social system
• Subsistence economy
• Sustenance
• Traditional economics
• Values

Copyright © 2012 Pearson Addison-Wesley. All rights reserved.


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