Measures of Development

1. Measures of Development

2. Human Development Index • recognizes a country’s development level as a function of • economics (GDP per capita), • social (literacy rate & level of education), and • demographic factors (life expectancy) • Highest possible rank is 1.0

3. Economic Indicator • GDP per capita: the value of the total output of goods and services produced in a country in a normal year divided by total population

4. GDP per Capita • European countries have the highest per capita GDP because of high GDP and low population. • Luxembourg – $79,000 • Norway - $53,300 • Africa the lowest per capita GDP due to low GDP and high population • Zimbabwe - $300 • DRC - $350

5. GDP

6. GDP • Which countries have high GDP? • Which countries have low GDP? (don’t just pick the easy ones you know) • What is Luxembourg’s category of GDP? Which other countries are in the same category? • Explain how the Western European country of Luxembourg has this level of GDP.

7. GDP • Throughout this presentation – pay attention to Brazil, Russia, China, India, and South Africa. • Let me explain when I say • Rule of Thumb – what is generally happening in the area • Weird exception – in an area everything is generally one way except this one country is noticeably different • For example – on the next slide the rule of thumb is Sub-Saharan Africa has a low GDP per capita, the weird exception is South Africa & Botswana

8. GDP per Capita

9. GDP per Capita • Check Luxembourg – Is your explanation still valid? • Check B, R, I, C, and SA • Which regions have high GDP per capita? Any weird exceptions? • Which regions have low GDP per capita? Any weird exceptions? • Can you see the core, semi-periphery, and periphery pattern?

10. What is the correlation of landlocked states and low GDP per capita? Weird exceptions?

11. What is the correlation of gov’t type and low GDP per capita? Source: Matthew White, 2003. http://users.erols.com/mwhite28/othergov.htm Adapted from FreedomHouse.org

12. Another map of government type http://chartsbin.com/view/6kx

14. Correlation means when something happens then the other things happens to – • The left side of the x-axis means the government is very corrupt • Does HDI correlate government corruption? • What is the relationship between government corruption and economic development?

15. Social Indicators • Literacy rate – the percentage of a country’s people who can read and write. • Literacy rates exceed 98% in MDCs • Amount of education – measured by taking the average number of years a student attends school in a country.

16. Literacy Rate

17. Literacy Rate • Check B, R, I, C, and SA – anything unusual • Which regions are high? Weird exceptions? • Which regions are low? Weird exceptions? • Why do the former Soviet countries, which is semi-periphery, have a high literacy rate

18. Years in School

19. Years in School • Check B, R, I, C, and SA – anything unusual? • Which regions are high? Weird exceptions? • Which regions are low? Weird exceptions?

20. Compare – any significant differences? • Do you see core, semi-periphery, and periphery?

21. Demographic Indicators • Life expectancy • This is the average age of death for the citizenry • Because of better healthcare, people in MDCs tend to live 10-13 years longer than in LDCs.

22. Life Expectancy

23. Life Expectancy • Do you see core, semi-periphery, and periphery? • Check B, R, I, C • Pay particular attention to South Africa – Why?

24. Make a Prediction • Which regions have a high HDI? • Low HDI?

25. Human Development Index

26. HDI • Do you see core, semi-periphery, and periphery? • Check B, R, I, C and SA

27. Other Indicators

28. Health Expenditure as % of GDP

29. Physicians /1,000 persons

30. Physicians /1,000 persons • Why do the former Soviet countries have so many physicians?

31. Pvt Expenditure as % of Total Health Expenditure

32. Infant Mortality Rates

33. Natural Increase rate • Rate at which the population increases • Around 1.5% in LDCs and .1% in MDCs • This causes social strain due to increased social cost. • Crude Birth rate • Rate at which children are being born into the population • LDCs face a rate around 24 per 1000 while MDCs are around 11 per 1,000 • Because LDCs death rate is 8 per 1000 this leads to an enormous increase in population

34. NIR

35. Other Economic Indicators • Sectors of the Economy • Productivity • Raw Materials • Consumer goods

36. Sectors of the Economy • Primary –lowest sector of sophistication. Involves extracting materials directly from the earth; mining, agriculture, fishing, and forestry • Higher % of population = greater chance of poverty

37. Sectors of the Economy • Secondary sector – manufacturing that transforms raw materials into useful products.

38. Sectors of the Economy • Tertiary – occupations based on providing services; tourism, restaurants, retail, etc. • Most MDCs have the majority of their economy in this sector. • Quantenary – service based occupations that are intellectual in nature; education, library services, government, etc. • Quinary – service based occupations that involve cutting edge technology

39. Make a Prediction • Regions that are primarily • Primary • Secondary • Tertiary

40. The percentage of people working in agriculture exceeds 75% in many LDC’s of Africa and Asia. In Anglo-America and Western Europe the figure is <5% Primary Products

41. Africa is almost exclusively focused on Primary production.

42. Industrial Sector • The way to read this map – shown larger on the next slide • The country with the highest secondary sector output, Merica, is set to 100%. • The other countries production is given as a percentage of what the USA is producing. • So USA is producing $2.5 trillion, then Japan is producing 50% or $1.25 trillion. • Ditto for the Service slide

43. Industrial Sector

45. Productivity • Value of a product in comparison to the labor needed to make it. • It is measured by assessing the value added per worker • Value added is the gross value of the product minus the costs of raw materials and energy • US has a value added of $80,000 in comparison to countries such as India at $500

46. Productivity • MDCs - produce more because of access to technology, tools, and equipment. • Money earned is reinvested into new technology increasing overall output. • LDCs - rely on animal and human power resulting in less production

48. Raw Materials • Necessary for production • Ex. United States and Russia - rapid industrial development due to an enormous amount of available resources. • Ex. United Kingdom have had to establish colonies to replace depleted resources • Ex. Botswana, Namibia, South Africa – DeBeers Diamonds (founded by Cecil Rhodes)

49. Diamond Mines

50. Raw Materials • Other countries have lots of resources but foreign private industries are responsible for mining (Diamonds in South Africa).