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Chapter 1: OutlineChapter 1: Outline

1. Three Vignettes (3 contrasting stories about 1. Three Vignettes (3 contrasting stories about livelihood change in …. livelihood change in …. A. MalaysiaA. MalaysiaB. EthiopiaB. EthiopiaC. UkraineC. UkraineD. Development & GlobalizationD. Development & Globalization

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2. Rich and Poor Countries: 2. Rich and Poor Countries: There is more between rich & There is more between rich & poorpoor

Learn Terminology abut different stages of Learn Terminology abut different stages of County level of development based on IncomeCounty level of development based on Income

Developed vs developing or less developed Developed vs developing or less developed (LDCs), Low income Countries (LICs), lower (LDCs), Low income Countries (LICs), lower middle income (LMIC), upper middle income middle income (LMIC), upper middle income (UMIC), high income (HIC), newly industrialized (UMIC), high income (HIC), newly industrialized or OECD countries, third world, North vs South.or OECD countries, third world, North vs South.

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3. Growth and 3. Growth and DevelopmentDevelopment

Growth is Growth is notnot the same as Development the same as Development• Development = Economic Growth + structural change Development = Economic Growth + structural change

involving participation of people in the economy.involving participation of people in the economy.

A Key feature of economic growth is that modern A Key feature of economic growth is that modern economic Growth that involves economic Growth that involves the application of the application of Science and TechnologyScience and Technology for human progress for human progress (Simon Kuznets view)(Simon Kuznets view)

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4. A Development 4. A Development ContinuiumContinuium

Developing country covers a diverse group of Developing country covers a diverse group of African and other developing economies in Asia, African and other developing economies in Asia, Latin America, Caribbean, etc...Latin America, Caribbean, etc...

• Income per capital is a key indicator of development but, Income per capital is a key indicator of development but, limitedlimited..One limitation is the international comparison One limitation is the international comparison requires converting country currency into a requires converting country currency into a common currencycommon currency

• A more accurate method is Purchasing Power Parity A more accurate method is Purchasing Power Parity compared to using simple exchange rates conversioncompared to using simple exchange rates conversion..

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Other methods include using physical measures Other methods include using physical measures of wellbeing such as Energy Use, life Expectancy, of wellbeing such as Energy Use, life Expectancy, Adult Literacy, Proportion of rural population, etc.Adult Literacy, Proportion of rural population, etc. See Figures 1.1 to 1.4 carefullySee Figures 1.1 to 1.4 carefully

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5. A Glance at History5. A Glance at HistoryA. A. Multiple Paths to DevelopmentMultiple Paths to Development across the World across the World nations based on different historical & colonial nations based on different historical & colonial experiences for Africa, Latin America, & Asia.experiences for Africa, Latin America, & Asia.HW1: Colonialism and development. HW1: Colonialism and development. B. B. Diversity in Development AchievementsDiversity in Development Achievements

But, there is also But, there is also common features or goals of common features or goals of desire for education, developed institutions, self-desire for education, developed institutions, self-government, government, cultural identity & pride cultural identity & pride (what we (what we called such factors?)called such factors?), etc, etc

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Approaches to Approaches to DevelopmentDevelopment

Development is a complex and multi-Development is a complex and multi-dimensional process that can be understood dimensional process that can be understood by combining the understanding of by combining the understanding of economics, economics, empirical analysis, and institutions and politics as well empirical analysis, and institutions and politics as well as cultureas culture

Development is foremost a process Development is foremost a process about peopleabout people involving mobilization of inputs, the role of involving mobilization of inputs, the role of trade, sectors including the role of government trade, sectors including the role of government in human development. It is multi-disciplinary.in human development. It is multi-disciplinary.

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Country StudiesCountry Studies

Look up selected African countries in annual Look up selected African countries in annual publications such as the World Development publications such as the World Development Report (World Bank) & Human Development Report (World Bank) & Human Development Report ( UNDP)Report ( UNDP)

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Identification & Paired-Identification & Paired-ConceptsConceptsNote: Explain the meaning and the relationships, if anyNote: Explain the meaning and the relationships, if any

Economic Growth & Economic DevelopmentEconomic Growth & Economic Development Modern Economic Growth & ModernizationModern Economic Growth & ModernizationNorth & SouthNorth & SouthGDP and per capita incomeGDP and per capita incomeWorld Bank , OECDWorld Bank , OECDIndustrialization, UrbanizationIndustrialization, UrbanizationSubstitutes, LDCSSubstitutes, LDCSInstitutions, Economic DevelopmentInstitutions, Economic Development

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MalaysiaMalaysiaPopulation: 28+ mPopulation: 28+ mMalaysia is a relatively open sate-oriented and Malaysia is a relatively open sate-oriented and newly newly newly industrialized market economy. . The state plays a significant but declining role in The state plays a significant but declining role in guiding economic activity through macroeconomic guiding economic activity through macroeconomic plans. plans. One of the best economic records in Asia, with GDP One of the best economic records in Asia, with GDP growing an average 6.5% annually from 1957 to growing an average 6.5% annually from 1957 to 2005. In 2011 the GDP (PPP) was about $450 2005. In 2011 the GDP (PPP) was about $450 billion, the 3rd largest economy in ASEAN and billion, the 3rd largest economy in ASEAN and 29th largest in the world..

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KenyaKenyaPop.: 41+ m.Pop.: 41+ m.Is the biggest and most advanced economy in east Is the biggest and most advanced economy in east and central Africa and central Africa Kenya is still a poor developing country with a Kenya is still a poor developing country with a (HDI) of 0.509, putting the country at position 143 (HDI) of 0.509, putting the country at position 143 out of 185 out of 185 Half of Kenyans live in absolute poverty. The Half of Kenyans live in absolute poverty. The important agricultural sector is one of the least important agricultural sector is one of the least developed and largely inefficient, employing 75% developed and largely inefficient, employing 75% of the workforce compared to less than 3 percent of the workforce compared to less than 3 percent in the food secure developed countries.in the food secure developed countries.

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NigeriaNigeriaPop. 162+ m.Pop. 162+ m.With its abundant supply of natural resources, well-With its abundant supply of natural resources, well-developed financial, legal, communications, transport developed financial, legal, communications, transport sectors and stock exchange (2nd largest in Africa). sectors and stock exchange (2nd largest in Africa). Nigeria is ranked 31st in the world in terms of Nigeria is ranked 31st in the world in terms of GDP GDP (PPP)(PPP) as of 2011. as of 2011. The United States is the country's largest foreign The United States is the country's largest foreign investor. investor. HW#2: What about oil exports to USA?HW#2: What about oil exports to USA? The IMF projected economic growth of 9% in 2008 The IMF projected economic growth of 9% in 2008 and 8.3% in 2009. The IMF projects a 8% growth in and 8.3% in 2009. The IMF projects a 8% growth in the Nigerian economy in 2011.the Nigerian economy in 2011.

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EthiopiaEthiopiaPop. 84+ m.Pop. 84+ m.IMFIMF: one of the fastest growing economies in the world, : one of the fastest growing economies in the world, registering over 10% economic growth from 2004 registering over 10% economic growth from 2004 through 2009. It was the fastest-growing non-oil-through 2009. It was the fastest-growing non-oil-dependent African economy in the years 2007 and dependent African economy in the years 2007 and 2008.2008.Growth has decelerated moderately in 2012 to 7% and Growth has decelerated moderately in 2012 to 7% and is projected to be 6.5% in the future is projected to be 6.5% in the future During 2008 and 2011: high During 2008 and 2011: high inflationinflation and a difficult and a difficult balance of paymentsbalance of payments situation. Inflation surged to 40% situation. Inflation surged to 40% in August 2011 in August 2011 GDP per capita is one of the lowest in the worldGDP per capita is one of the lowest in the world

For more info:For more info:• African Development Bank Group:African Development Bank Group:

http://www.afdb.org/en/http://www.afdb.org/en/• WB: Country Overview: WB: Country Overview:

http://www.worldbank.org/en/country/malaysia/overhttp://www.worldbank.org/en/country/malaysia/overviewview

• For Data and Stat.: Index Mundi:For Data and Stat.: Index Mundi:http://www.indexmundi.com/http://www.indexmundi.com/

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