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Economic Development of AsiaIntroduction and OverviewChapters 1(a), 2(a) and 1(b)
Players at a Glance
•Tier 1 – Newly Industrialized Countries (NIC’s)▫South Korea, Taiwan, Hong Kong,
Singapore•Tier 2 – S.E. Asian Developing Countries
▫Thailand, Malaysia, Indonesia, Philippines•Tier 3 – South Asian Developing Countries
▫India, Pakistan, Bangladesh, Nepal, Bhutan•China – East Asian Developing Country
(Tier 3)
How the Other Half Live
•40% of world population lives on less than $2 a day.
•Extreme poverty▫Starvation, dispair
•Extreme disparities in income distribution (see fig. 11)
•Poor quality of live, subsistence standards
UN Millennium Development Goals (MDG’s)
•In the year 2000, 189 member countries of the UN adopted eight MDG’s to eradicate poverty and achieve other human development goals by the year 2015.
•What are these goals?▫(Group Exercise 1 – Find a list of UN MDGs
by searching the internet) (15 minutes)
UN Millennium Development Goals (cont’d)•Eradicate extreme poverty and hunger•Achieve universal primary education•Promote gender equality•Reduce child mortality• Improve maternal health•Combat HIV/Aids, Malaria and other
diseases•Ensure environmental sustainability•Develop a global partnership for
development
http://www.youtube.com/watch?v=SaCMHoq7MCg
Measuring Development
How do we define development?•World Bank classification by Per Capita
Gross National Income – Growth Rate•Capabilities Approach – A.K. Sen•Development and Happiness – Bhutan
Human Development Index
•HDI takes into account (pg.49-56)▫GDP PC (PPP)▫Life Expectancy▫Education
•HDI = 1/3 (Income Index) + 1/3 (Life Expectancy Index) + 1/3 (Education Index)
Human Development Index
Income Index=log(current income) – log(100)log(40,000) – log(100)
Life Expectancy Index=current life expectancy – 25 years
85-25
Human Development Index
Education Index is made up of two parts:
Adult Literacy Index=current adult literacy - 0
100 - 0
Gross Enrollment Index=current gross enrollment
100 - 0
Human Development
Education Index =
2/3(Adult Literacy Index) +
1/3( Gross Enrollment Index)
Human Development Index
•HDI now equals HDI=
1/3(Income Index)+
1/3(Life Expectancy Index)+
1/3(Education Index)
Human Development Index
•Calculate HDI for India:▫GDP PC (PPP)= 3,460▫Life Expectancy= 64 years▫Adult Literacy= 70▫Gross Enrollment= 65%
Common Characteristics of Developing Countries(pg. 56-71 Todaro)•Lower levels of living and productivity•Lower levels of human capital•Higher levels of inequality and absolute
poverty (fig. 27)•Higher population growth rate•Greater social fractionalization•Large rural populations (migration)•Lower levels of industrialization
Common Characteristics of Developing Countries•Adverse geography or resource endowment•Underdeveloped financial market•Colonial impact•External dependance•Role of public – Private sector(Exercise – Are living standards of developed
and developing countries converging? Read 78-81 and write 2 paragraphs) Due next class