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Economical Development Midterm Notes

The document provides an overview of key concepts in economic development, including: 1) Absolute poverty refers to an inability to meet basic needs like food, clothing, and shelter. Subsistence economies only produce enough for personal consumption of necessities. 2) Development aims to improve quality of life through raising living standards, self-esteem, and freedom. It is the transformation from economic stagnation to growth and poverty reduction. 3) Globalization is increasing integration into international markets. Development economics studies how economies transform from low to high income.

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Doug Conway
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142 views

Economical Development Midterm Notes

The document provides an overview of key concepts in economic development, including: 1) Absolute poverty refers to an inability to meet basic needs like food, clothing, and shelter. Subsistence economies only produce enough for personal consumption of necessities. 2) Development aims to improve quality of life through raising living standards, self-esteem, and freedom. It is the transformation from economic stagnation to growth and poverty reduction. 3) Globalization is increasing integration into international markets. Development economics studies how economies transform from low to high income.

Uploaded by

Doug Conway
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Economic Development midterm 1 Notes

Chapter 1: Introducing Economic Development: A global Perspective

Absolute poverty- A situation of being unable to meet the minimum levels of income, food, clothing.
Healthcare, shelter, and other essentials

Subsistence economy- An economy in which production is mainly for personal consumption and the
standard of living yields little more than basic necessities of life-food, shelter, and clothing.

Development- The process of improving the quality of all human lives and capabilities by raising people’s
levels of living, self-esteem, and freedom.

Traditional economics is an approach to economics that emphasizes utility, profit maximization, market
efficiency, and determination of equilibrium

Development Economics: The study of how economies are transformed from stagnation to growth and
for low income to high income status and overcome problems of absolute poverty.

Globalization: The increasing integration of national economies into expanding international markets

Social System : The organizational and institutional structure of a society, including its values, attitudes,
power structure, and traditions.

Income per capita: Total GNI/Total Population

Gross National Income: The total domestic and foreign output claimed by residents of a country. It
comprises GDP plus factor incomes accruing to residents from abroad, less the income earned in the
domestic economy accruing to persons abroad

Development must include multidimensional process of improvements to social structures, popular


attitudes, and national institutions as well as the acceleration of economic growth the reduction of
inequality, and the eradication of poverty.

Amartya Sen’s Capability Approach

What people do or can do with the commodities of given characteristics that they come to possess or
control.

Sen’s Five sources of disparity


1. Personal heterogrenities
2. Environemental diversities
3. Variations in social climate
4. Distribution within the family
5. Differences in relational perspecitive

Sustenance
Self -esteem
Freedom

Sector
Tech sector
Activity
Trade and sphere

How low income contires today differ from developed countries

1. Phsyical and human resource endowments


2. Per capia incomes and levels of GDP in relation to the rest of the world
3. Climate
4. Population size, distribution, and growth
5. Historical role of international migration
6. International trade benefits
7. Basic scientific and technological research and development capabilities
8. Efficacy of domestic institutions

Terms of trade: The ratio of a country’s average export price to its average import price.

Divergence a richer country pulls away in the economic competiton compared to the poor.

Convergence a poorer country catches up in economic competiton compared to the rich


Linear stages of growth model
Theories and patterns of structural change
International-dependence revolution
Neoclassical free-market counterrevolution

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