Chapter 1

1. Chapter 1 Patterns of Development

2. What is Development?

3. What is Development? • “Development” … al Biology? • A natural, desirable, inescapable process of improvement/maturation/fulfillment. • “Development” as in “Fundraising”? • A planned process of intervention to achieve certain goals for the benefit of something else.

4. What is Development? • Historical and ahistorical definitions. • Evaluative, a-historical definitions are the focus of DE. • Positive (i.e., neutral) versus normative (i.e., evaluative) meanings. • Positive and evaluative meanings are intertwined. • Although the line is blurry, but either we identify our values, or we adopt hidden values (or someone else’s values).

5. What is Development? • Definitions: achievement a particular goal or the opportunity to achieve your own goals? • Is having means but no clear ends development? • Being or having? How do we define these terms and make them concrete? • Are the criteria for development universal or are they relative to particular contexts?

6. A-Historical Definitions • Elaboration, improvement, evolution; • Unveiling and fulfillment of potential. • Neutral usages of development: • Structural change • Intervention, action. • Evaluative usages: • Improvement, good change • Pre-conditions for improvement

7. A-Historical Definitions • Neutral usages of development: • Structural change • “To develop” as an intransitive verb. An endogenous process • Economic growth, GDP per capita. • Modernization (industrialization, urbanization, globalization, transformation of relations of production). • Marxism; Rostow’s Stages of Economic Growth.

8. A-Historical Definitions • Neutral usages of development: • Intervention, action. • “To develop” as a transitive verb. • A group (the government, the NGOs, the UN, the IFIs, the universities) understands the means of development and modernization better; it knows the ends are desirable. • It plans the development process and imposes it onto society or encourages society to follow it.

9. A-Historical Definitions • Evaluative usages: • Improvement, good change • Desirable growth and modernization; fulfillment of good potentials, especially that of increased material welfare in the South. • Keeping the end in sight prevents turning the means (growth, modernization) into ends. • “The people are the only deciders of what is development” • But how did the people come to this decision? • Are there any universal preconditions for self-determination?

10. A-Historical Definitions • Evaluative usages: • Pre-conditions for improvement • Goulet: D is what leads to improvement. • So D depends on values (what is improvement?) and theory (what causes improvement?) • Being able to self-define D is also an improvement, maybe also part of D. • So D is the change; D is the opportunity change creates; and D is the actual improvement. • Or D is what automatically creates improvement.

11. Definitions of Development

12. Historical Meanings of Development • “Fourth, we must embark on a bold new program for making the benefits of our scientific advances and industrial progress available for the improvement and growth of underdeveloped areas. • More than half the people of the world are living in conditions approaching misery. Their food is inadequate. They are victims  of disease. Their economic life is primitive and stagnant. Their poverty is a handicap and a threat both to them and to more prosperous areas. • Greater production is the key to prosperity and peace. And the key to greater production is a wider and more vigorous application of modern scientific and technical knowledge. • Only by helping the least fortunate of its members to help themselves can the human family achieve the decent, satisfying life that is the right of all people.” • Harry Truman, 1949 Inaugural Address

13. Historical Meanings of D • The idea of development became popular after WWII, • Fostered by USA (and Europe) and USSR. • But it had started in the early XIXc: • Saint-Simon, Comte: change can be destructive, but guided change can lead to improvement or to the opportunity for improvement.

14. History of Development • Rise of Europe: • XVI to XVIIIc, globalization, markets, Kist institutions; • XIX to mid-XX, technology in production, social management. • Liberalism and utilitarianism arose to justify/foster the ordering of a commercial society.

15. History of Development • Post-WWII • Post-colonialism • Awareness of tech and income gap; • West versus USSR • Imposed their models as “conscious major state-led intervention for national economic advance.” • Societal improvement and (or?) catching up. • Globalization, inter- and intra-country polarization.

16. How ought a society to exist and move into the future? • Is social improvement the same for everyone or should it be defined case by case? • Many societies may agree on some values; • Development is to increase the range of opportunities for doing what one chooses; the preconditions for this may be universal. • Opportunities to be or to have?

17. How ought a society to exist and move into the future? • GDP per capita • … plus manufacturing share and literacy • Human Development Index • It’s objective, so it’s comparable across countries and time. • “A process of change in social structures, physical infrastructure, technology and skills, culture and moral and spiritual values which creates conditions and an environment for a happier and more contented humanity.” Nkomo, qtd. p. 37.

18. How ought a society to exist and move into the future? • Development as enlarging people’s choices (Arthur Lewis and Amartya Sen) • Valuable options are what matter, not just a large number of options. • No choices may even be better than a thousand distractions. • People prefer to know they are acting independently. • Being is better than having; and outcomes as better than opportunities. • But, given the lack of data, a “having” measure such as GDP can become a proxy for the “opportunity to be” and for “being.”

19. GDP / GNP • GNP is a better measure of welfare than GDP: it focuses on the country’s people. However, • GNP includes activities such as waste disposal, pollution abatement, etc.; investment. • GNP excludes non-market goods, such as housework or leisure. • GNP gives more weight to luxury goods and less weight to the goals of the moneyless. • GNP doesn’t account for the use of capital; NNP doesn’t include the use of environmental capital. • But it measures both achievement and opportunity, and is both universal and contextual.

20. GDP / GNP • GNP is objective: it’s the same measure everywhere. • It’s contextual: it reflects what people in that country wanted to produce. • Often, what is produced is what foreigners/the wealthy want: this may reflect military/political/economic pressure or mutual self-interest. • Compare this with Relativist measures that insist that development is “whatever people define as development.”

21. GDP / GNP

22. Commonality • Universal aspirations: • Freedom from poverty, violence, and servitude; Being loved and belonging; Control over one’s life, its details and its direction (Edwards). • Life, Knowledge, Play, Aesthetic Experience, Friendship, Self-determination; Religion (Finnis – check for basic values).

23. Growth and Development

28. How do we draw these graphs? • http://mysite.avemaria.edu/gmartinez/Courses/ECON320/table1-1.xls • Select the data you want to plot. • Insert | Chart … • Scatter plot • Double-click on axes. Change them to logarithmic scale. • Double-click on chart area. Erase background and borders.

29. How do we draw these graphs? • http://mysite.avemaria.edu/gmartinez/Courses/ECON320/table1-1.xls • Copy the data onto the Stata Data Editor • Delete row 3 first (what happens when you don’t?) • Use dialog box, or typetwoway (scatter energy gnippp, sort mlabel(countryname)) (lfit energy gnippp), yscale(log) xscale(log) title(Energy Use compared to GNI per capita PPP)

30. 1914 http://upload.wikimedia.org/wikipedia/en/2/2a/ColonialAfrica.png

31. http://www.assumption.edu/users/mcclymer/His130/P-H/burden/asia1914.gifhttp://www.assumption.edu/users/mcclymer/His130/P-H/burden/asia1914.gif

32. http://websupport1.citytech.cuny.edu/Faculty/pcatapano/lectures_wc2/triangulartrade.jpghttp://websupport1.citytech.cuny.edu/Faculty/pcatapano/lectures_wc2/triangulartrade.jpg

33. Differences

34. Differences

35. https://publications.worldbank.org/subscriptions/WDI/

36. https://publications.worldbank.org/subscriptions/WDI/

37. https://publications.worldbank.org/subscriptions/WDI/

38. https://publications.worldbank.org/subscriptions/WDI/

39. https://publications.worldbank.org/subscriptions/WDI/

40. https://publications.worldbank.org/subscriptions/WDI/

42. Substitutes • There usually are way around, or substitutes, for any single barrier or prerequisite. • But the existence of many of these barriers or the absence of a wide variety of desirable preconditions make economic development more difficult.

43. Doubling time • If a country’s income today is X and it grows at a rate of r%, it will reach an income of 2X in t=70/(r*100) years.

44. Doubling time • If a country’s income today is X and it grows at a rate of r%, it will reach an income of 2X in t=70/(r*100) years.

45. Record • Improvement in • Life expectancy • Literacy • Changes and challenges • Information revolution • Disease • Environmental degradation • Demographic transition and aging

46. Institutions • How does one create the institutions (governmental, financial, commercial) that facilitate development? • Can we create efficient markets or should the state take over? • Is a fully developed financial system indispensable? • Land reform? • Legal reform?