BBM 121 Development Studies Module
BBM 121 Development Studies Module
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Mt Kenya University
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P.O. Box 342-01000
Thika
Email: [email protected]
Web: www.mku.ac.ke
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Course Code: BBM 121
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Course Title: Development Studies
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Purpose: To introduce students to the general concepts and make students aware of the development issues
affecting Kenyans and other peoples of the region and the world at large
Course Objectives: By the end of the course unit the student will be able to:-
i) Explain the various aspects of cultural, social and economic development and their
relationships
ii) Discuss the concept of gender in development
iii) Explain general development concepts and development agencies
iv) Describe the various indicators of development and their limitations
Course Content:
Theories of Development and Underdevelopment; Historical roots of African development and under
development; Development Ethics; Ethics and cultural values in development; Population and Development-
Poverty and Inequality in population, rural-urban migration, natural resources and environment, science and
technology in development; Gender and Development- Concepts of gender, rationale for mainstreaming
gender, the affirmative action and development, Development strategies- Economic growth,
industrialization, modernization indicator problem and regional integration, participatory development; Co-
operatives and Development- The social and economic role of co-operative movement in development;
Economic liberalization- The roles of trade direct foreign investments, foreign aid, structural adjustments
and stabilization
Reference Books:
• Todaro, Michaela P., Economics for a developing worlds: an introduction to principles problems
and policies, Prentice Hall Press
• Sen. Amartya (2000), Development as Freedom, New York
• Salter R.O. (1993), Global Transformation and the Third World Boulder Inc
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TABLE OF CONTENTS
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Page
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COURSE OUTLINE.......................................................................................................................i
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TABLE OF CONTENTS................................................................................................................ii
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Review Questions............................................................................................................................50
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CHAPTER FIVE: Gender and Development............................................................................51
Concepts of gender………………………………………………………………………………..51
Gender Mainstreaming…………………………………………………………………………...52
The affirmative Action…………………………………………………………………………….54
Review Questions............................................................................................................................55
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CHAPTER ONE
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THEORIES OF DEVELOPMENT AND UNDERDEVELOPMENT
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Learning Objectives
By the end of this chapter the learner should be able to:
i) Define the term development and distinguish it from underdevelopment
ii) Discuss the tenets of the various theories of development and underdevelopment
iii) Discuss the points of divergence between modernization theories and
dependency theories
iv) Describe the limitations to the development of a general theory of development
Introduction
The term development is understood as a social condition within a nation, in which the
authentic needs of its population are satisfied by the rational and sustainable use of natural
resources and systems. This utilization of natural resources is based on a technology, which
respects the cultural features of the population of a given country.
This general definition of development includes the specification that social groups
have access to organizations, basic services such as education, housing, health services, and
nutrition, and above all else, that their cultures and traditions are respected within the social
framework of a particular country.
In economic terms, the aforementioned definition indicates that for the population of a
country, there are employment opportunities, satisfaction -at least- of basic needs, and the
achievement of a positive rate of distribution and redistribution of national wealth. In a
political sense this definition emphasizes that governmental systems have legitimacy not only
in terms of the law, but also in terms of providing social benefits for the majority of the
population.
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underdevelopment. Differences in structure and historical origin are considered of little
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importance; international dependencies are not taken into account.
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Consequently, a change of these endogenous factors is the strategy for development. The
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industrialized countries are the model for economy and society, and this model will be reached
sooner or later.
There is a continuum between the least and the most developed country and each
country has its position on this line. The difference as compared to the industrialized countries
is the degree of backwardness which has to be made up for. Suitable measures are the
modernization of the production apparatus, capital aid, transfer of know-how, so that the
developing countries can reach the stage of industrialized countries as soon as possible.
Development is seen as an increase of production and efficiency and measured primarily by
comparing the per capita income.
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between regions, the capital sometimes being an island which, in geographical terms, belongs
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to the developing country, in economic terms, however, to the industrialized country.
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Economic, technological, and regional dualism are often the consequence of a social
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dualism, the absence of relationships between people of different race, religion, and language,
which, in many cases, is a legacy of colonialism.
Development in dualism concepts is the suppression of the traditional sector by
concentrating on and expanding the modern sector. In time, it is assumed that the trickle down
effects will reduce and abolish dualism. In this line of thinking, the main problem is capital
formation because its degree determines the scope and speed of expansion of the modern
sector. In general, agriculture has to provide the resources, labour as well as capital, for
expanding the modern sector.
Strategy theories intend to break up this cycle at a certain point which they consider
critical and which varies according to the different theories. Thus, they want to initiate
development and transform traditional subsistence economy into a modern market economy.
Their main emphasis is on capital formation and investment (investment theories) and, by and
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large, they prescribe action for overcoming underdevelopment while they contribute little
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towards explaining the causes of underdevelopment.
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1.2.1 Theory of Balanced Growth
This theory sees the main obstacles to development in the narrow market and, thus, in
the limited market opportunities. Under these circumstances, only a bundle of complementary
investments realized at the same time has the chance of creating mutual demand. The theory
requests investments in such sectors which have a high relation between supply, purchasing
power, and demand as in consumer goods industry, food production, etc.
The real bottleneck in breaking the narrow market is seen here in the shortage of
capital, and, therefore, all potential sources have to be mobilized. If capital is available,
investments will be made. However, in order to ensure the balanced growth, there is a need for
investment planning by the governments.
Development is seen here as expansion of market and an increase of production
including agriculture. The possibility of structural hindrances is not included in the line of
thinking, as are market dependencies. The emphasis is on capital investment, not on the ways
and means of achieving capital formation.
It is assumed that, in a traditional society, there is ability and willingness for rational
investment decisions along the requirements of the theory. As this will most likely be limited
to small sectors of the society, it is not unlikely that this approach will lead to super-imposing a
modern sector on the traditional economy, i.e., to economic dualism.
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According to the theory, not a balanced growth should be aimed at, but rather existing
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imbalances— whose symptoms are profit and losses—must be maintained. Investments should
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not be spread evenly but concentrated in such projects in which they cause additional
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investments because of their backward and forward linkages without being too demanding on
entrepreneurial abilities. Manufacturing industries and import substitutions are relevant
examples. These first investments initiate further investments which are made by less qualified
entrepreneurs.
Thus, the strategy overcomes the bottleneck of entrepreneurial ability. The theory gives
no hints as to how the attitude of entrepreneurs and their institutional influence will be changed
in time.
1.2.3 Theory of Stages of Growth
This theory tries to explain the long-term processes of economic development from the
point of view of economic history by describing five ideal types of stages through which all
societies pass:
i) ‘Traditional Society Stage’
The 'traditional society' has more than 75 per cent of the population engaged in food
production, and political power is in the hands of landowners or of a central authority
supported by the army and the civil servants.
ii) 'Transitional Stage'
The 'transitional stage' creates the preconditions for take-off by bringing about radical
changes in the non-industrial sectors. Export of raw material gains momentum; a new class of
businessmen emerges; and the idea of economic progress coming from outside spreads through
the elite.
iii) 'Take-off Stage'
The 'take-off stage' brings a sharp increase in the rate of investment in the per capita
output. This stage of industrial revolution is accompanied by radical changes in the production
techniques. Expansion takes place in a small group of leading sectors at first and, on the social
side, is accompanied by the domination of the modern section of society over the traditional
one.
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iv) 'Drive to Maturity stage’
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The 'drive to maturity’ brings a spread of growth from the leading to the other sectors
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and a broader application of modern technology followed by necessary changes in the society
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at large.
v) 'Stage of High Mass Consumption'
The 'stage of high mass consumption' can be reached after attaining a certain level of
national income and formulating an economic policy giving priority to increased private
consumption.
The critical phase for development is the 'take-off stage' during which net investment
rates have to increase from 5 to 10 per cent of the national product and during which the
political, social, and institutional framework has to be built in order to reach a situation of self-
sustained growth. The financial resources must be accumulated internally by higher saving
rates. Income distribution favoring classes and strata which are willing and able to use capital
more productively than others has the same effect.
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1.2.6 Theory of Circular Causation
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This theory opposes the strategy of development poles because social systems and
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economic processes do not develop towards equilibrium but, on the contrary, factors tend to
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cumulate to positive or negative cycles. In principle, the theory is a negation of the mono-
causal explanation of problems of developing countries by economic factors alone. Rather, in a
comprehensive way, all social relations have to be incorporated.
At national level—different stages of development between regions—as well as
international level—trade between industrialized and developing countries—differences tend
to increase because of the spread effects in the more developed areas and modern sectors and
backwash effects in backward areas and traditional sectors. For instance, industrial import
goods are in competition with traditional crafts; terms of trade deteriorate; capital is being
transferred, etc.
The direction of processes depends on the initial situation and the factors causing the
change. Under the conditions in developing countries, increased regional dualism often is a
consequence of such processes of circular causation.
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Protestant ethics led to an ascetic life style which, instead of advocating affluence,
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reinvested the proceeds. As well, it is the basis of rationalism and goal achievement behavior.
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While a value system which motivates economic development can hardly be limited to
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Protestantism Weber's stress on values and the resulting motivation influenced later thought.
2. Dependency Theories
According to dependency theories, the cause of underdevelopment is the dependence
on industrialized countries while internal factors of developing countries are considered
irrelevant or seen as symptoms and consequences of dependence. The development of
industrialized countries and the underdevelopment of developing countries are parts of one
historical process. Developing countries are dependent countries. The economic and political
interests of industrialized countries determine their development or underdevelopment. The
goals are superimposed.
Underdevelopment is not backwardness but intentional downward development. As to
the causes of dependence, the various theories differ, economic factors always dominating.
External trade theories concentrate on economic relations between countries. Imperialism
theories stress the politico-economic interest while dependency theories concentrate on the
deformation of internal structures by dependence which perpetuates the situation. Dependency
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theories concentrate on explanations of the genesis of underdevelopment and pay little
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attention to strategies for overcoming this situation. Implicit development here means
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liberation, end of structural dependence, and independence.
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2.1 External Trade Theories
The structure of supply and demand in industrialized and developing countries is such
that industrialized countries are able to reap the benefits from international trade. This transfer
of resources makes development impossible, and these unequal trade relations are seen as the
reasons for underdevelopment.
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2.2 Imperialism Theories
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The imperialism theories explain the domination of underdeveloped areas by
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industrialized countries as the consequence of different economic and technological levels and
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unequal power potential resulting from a different economic growth. The consequence of the
development of industrial capitalistic societies is a pressure for expansion which may lead to
military or political acquisition (colonies) or to maintaining economic dependence (developing
countries).
Different theories have their own explanation of the reason for the pressure for
expansion but it is always seen as the result of the inability to cope internally with the
consequences of permanent technological innovation and their effects on the society.
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Towards a General Theory of Development and Underdevelopment
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All the theories discussed in this chapter are only partial theories. They explain certain
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aspects but do not fully explain the cause of underdevelopment. The explanation is more
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adequate for certain historical situations and specific conditions of production while they are
less relevant for others. They offer a strategy for overcoming the prevailing situation and
initiating development which may be suitable under certain economic and social conditions but
are not applicable to others.
A general theory of development is still lacking. Drawing up such a general theory is
indeed a difficult task; it would have to include:
i) an explanation of underdevelopment for different countries;
ii) an explanation of the development process of industrialized countries; and
iii) a strategy for overcoming underdevelopment in developing countries.
iv) all relevant disciplines and their interdependence;
v) the different levels at which development takes place, from the local to the
international level;
vi) the processes and relations between the different sectors and strata of society and
economy; and
vii) the international dimensions of the development process
While the system theory opens up the possibility of organizing such a vast theoretical
body, the activities of different researchers hitherto have not yet been successful. Even in the
absence of a concise theory to guide political activities, decision-makers must have some
yardsticks to measure whether their strategies and tools will achieve the goals of the society.
Here, goals play an important role. While, in detail, the question of goals in the
development process is a political question, and difference of opinion and conflict are possible,
at a high level of abstraction, universal agreement seems to be possible.
It is widely agreed that preservation of human dignity and fulfillment of basic needs are
the foremost duties of every society. While there is wide agreement on this goal, differences of
opinion exist on the question of the degree to which these basics should be supplied and, as
well, how they should be supplied. These differences allow for different paths of development.
From the common denominator "basic needs," one can deduct five basic goals of development:
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i) economic growth to secure food and other requirements for the population;
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ii) social justice to reduce inequality;
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iii) employment as means of earning an income but, as well, because of its ethical
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and social value;
iv) participation as political involvement and social sharing;
v) independence as freedom from external domination
While individual societies may have different opinions on the priorities of these goals,
in the absence of a general theory of development; one can use the criterion of fulfillment of
these goals as a yardstick in development. Development is then understood as a simultaneous
progress towards these five goals.
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ii) Archaic Production Technology
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For centuries the African continent depended on archaic methods of agricultural
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production. Even the use of ploughs and other animal drawn implements were limited. The
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agricultural revolution and the use of iron tools came to sub-Saharan Africa later than to other
parts of the world
An important reason for the continent’s technological underdevelopment is the
geographical obstacles to communication both internally and with the rest of the world. The
Sahara has been a barrier in the north, and the Atlantic coast had no contact with the rest of the
world until the first Europeans arrived around 1500. Influence from the Arab world and India
came mainly via the Nile Valley and the East African coast, and had little spillover effect
further inland. With the exception of the Niger and the Nile, the continent’s rivers with their
large waterfalls have not provided a navigable route to the interior, in contrast to the rivers of
Europe and Asia. The problems of today’s land-locked states illustrate the great importance of
communication for economic and cultural development
iii) Demographic Factors
` Africa’s demographic history has been characterized by low density of population and
continuous migration and settlement of new areas. The continent with a massive land mass of
over 30 million km2 has inhabitants less than that of India at present. Migration has continued
right up to the present day, and there is still more migration on this continent — including
migration between urban and rural areas — than anywhere else in the world. This continued
migration may be due to a hostile geographical environment that debilitates the livelihoods of
the population.
However, at present the demographic picture of the continent is totally different.
Rapidly growing population with limited demographic windows of opportunity has caused
further strain on the development efforts and environmental sustainability in the continent.
Rapid deforestation following population explosion has further aggravated the environmental
problems. The rapid deforestation is fueling desertification with its negative impacts on
agricultural production in many parts of sub Saharan Africa. Consequently, Africa is more food
insecure today than the era of wooden agricultural implements.
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iv) The Slave Trade
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The slave trade theory is one of the dominant views on the historic root causes of the
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African underdevelopment. According to this view, Africa’s engagement in slave trade caused
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massive depopulation of the continent over two centuries. Furthermore, the African countries
with the biggest slave exports are by and large the countries with the lowest incomes now
(based on per capita gross domestic product in 2000).
It has been shown that slave trade prevented state development, encouraged ethnic
fractionalization and weakened legal institutions and through these channels it affected
economic development. The export of an estimated 12 million people across the Atlantic, and
possibly a similar number to the Arab world in the course of a full millennium may have been
a factor in Africa’s lower population growth compared with that of other continents.
v) The Colonial Extraction System
Colonialism in Africa took different form compared to Asia. Unlike in Asia, hostile tropical
environment prevented colonizers from settling in Africa as a result of which they erected
extractive institutions in these colonies. These colonial institutions have persisted over time
and they continue to influence the economic performance of the colonies even long after
independence.
Research, shows that colonial extraction when severe enough can cause a society to move
from a high to low production level equilibrium. Due to the stability of low level equilibrium, a
society can remain trapped in this equilibrium even after the period of colonial extraction is
over. However, many African as well non-African scholars do not agree on the link between
colonial extraction and the current underdevelopment in Africa. Ethiopia was never colonized
but it is one of the least development countries in the continent while many Asian countries
which have achieved development miracle since 1960s have been former European colonies.
However, there is one crucial link between colonialism and underdevelopment in Africa.
This is the creation of a political map that is economically irrational and dysfunctional.
Colonialism created artificial and non viable nation states that lacked legitimacy. This is the
root cause of continued ethnic conflicts and civil wars that ravage the continent since the day
of decolonization. Thus unless Africa does away with the current artificial colonial boundaries
either through realignment of the current state boundaries wherever there are contestations or
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through more regional integration similar to the European model but not through hasty “United
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States of Africa” rhetoric, the continent will never achieve sustainable development.
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vi) Postcolonial Political Instability
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The post colonial Africa has been characterized by lack of political stability. Post
independence African politics was dominated by authoritarian regimes and kleptocracies.
These rent seeking dictators often intentionally sow seeds of ethnic conflicts by deliberate
political exclusion and marginalization of various ethnic groups that reside within the country.
Even after two decades of democratic reforms in the continent, today about 50% of
authoritarian states in the world are found in Africa. About 24 out of 54 states in Africa are
authoritarian regimes. Only Mauritius qualifies as a full democracy in the continent out of
about 30 full democracies in the world while 6 more countries in the continent are flawed
democracies.
Review Questions
i) Delineate the points of divergence and convergence between modernization theories
and dependency theories of development
ii) What are the tenets of dualism theories of development
iii) Discuss the factor that need to taken into consideration if a general theory of
development is to be formulated
iv) Colonization has been argued to be one of the root causes of African
underdevelopment yet Ethiopia and Liberia are relatively less developed than most of
the countries that were colonized. Discuss
v) Firestorms, harsh winters, hurricanes, earthquakes and other natural disasters are
more prevalent in North America than in Africa yet ‘a harsh natural environment’ is
argued to be one of the root causes of African underdevelopment. Explain
vi) Discuss the tenets of strategy theories of development
vii) State five basic goals of development
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CHAPTER TWO
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ECONOMIC GROWTH AND DEVELOPMENT
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Learning Objectives
By the end of this chapter the learner should be able to:
i) Differentiate between economic growth and economic development
ii) Describe the various measures of economic wellbeing
iii) Discuss the limitations of GDP as measure of economic wellbeing
vi) Describe the development indicator problem
Economic Growth
Economic growth is an increase in activity in an economy. It refers only to the quantity
of goods and services produced; it says nothing about the way in which they are produced.
Economic development
Economic development refers to social and technological progress. It implies a change
in the way goods and services are produced, not merely an increase in production achieved
using the old methods of production on a wider scale. Economic development typically
involves improvements in a variety of indicators such as literacy rates, life expectancy, and
poverty rates.
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gross operating surplus (or profits). The most common approach to measuring and quantifying
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GDP is the expenditure method:
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GDP = private consumption + gross investment + government spending + (exports −
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imports)
Gross national product (GNP) is sometimes used as an alternative measure to gross
domestic product. GNP adds net foreign investment income, unlike GDP.
GNP = GDP + net foreign investment income
Put simply, GDP is concerned with the region in which income is generated. It is the
market value of all the output produced in a nation in one year. GDP focuses on where the
output is produced rather than who produced it. GDP measures all domestic production,
disregarding the producing entities' nationalities.
In contrast, GNP is a measure of the value of the output produced by the "nationals" of
a region. GNP focuses on who owns the production. For example, in the Kenya, GNP measures
the value of output produced by Kenyan firms, regardless of where the firms are located.
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business transactions occurring informally, portions of local economy are not easily registered.
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GDP also ignores subsistence production.
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Quality of goods – People may buy cheap, low-durability goods over and over again, or
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they may buy high-durability goods less often. It is possible that the monetary value of the
items sold in the first case is higher than that in the second case, in which case a higher GDP is
simply the result of greater inefficiency and waste.
Quality improvements and inclusion of new products – By not adjusting for quality
improvements and new products, GDP understates true economic growth. For instance,
although computers today are less expensive and more powerful than computers from the past,
GDP treats them as the same products by only accounting for the monetary value. The
introduction of new products is also difficult to measure accurately and is not reflected in GDP
despite the fact that it may increase the standard of living. For example, even the richest person
from 1900 could not purchase standard products, such as antibiotics and cell phones that an
average consumer can buy today, since such modern conveniences did not exist back then.
What is being produced – GDP counts work that produces no net change or that results
from repairing harm. For example, rebuilding after a natural disaster or war may produce a
considerable amount of economic activity and thus boost GDP. The economic value of health
care is another classic example—it may raise GDP if many people are sick and they are
receiving expensive treatment, but it is not a desirable situation.
Externalities – GDP ignores externalities such as damage to the environment. By counting
goods which increase utility but not deducting or accounting for the negative effects of higher
production, such as more pollution, GDP is overstating economic welfare.
Sustainability of growth – GDP does not measure the sustainability of growth. A country
may achieve a temporarily high GDP by over-exploiting natural resources or by misallocating
investment.
For example, the large deposits of phosphates gave the people of Nauru one of the highest
per capita incomes on earth, but since 1989 their standard of living has declined sharply as the
supply has run out. Oil-rich states can sustain high GDPs without industrializing, but this high
level would no longer be sustainable if the oil runs out.
Economies experiencing an economic bubble, such as a housing bubble or stock bubble, or
a low private-saving rate tend to appear to grow faster owing to higher consumption,
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mortgaging their futures for present growth. Economic growth at the expense of environmental
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degradation can end up costing dearly to clean up; GDP does not account for this.
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Alternative Measures of Economic Wellbeing
Genuine Progress Indicator (GPI)
GPI is a concept in welfare economics that has been suggested to replace gross
domestic product (GDP) as a metric of economic growth.
GPI is an attempt to measure whether a country's growth, increased production of goods, and
expanding services have actually resulted in the improvement of the welfare (or well-being) of
the people in the country. GPI advocates claim that it can more reliably measure economic
progress, as it distinguishes between worthwhile growth and uneconomic growth.
The GDP vs the GPI is analogous to the difference between the gross profit of a
company and the net profit; the Net Profit is the Gross Profit minus the costs incurred.
Accordingly, the GPI will be zero if the financial costs financial gains in production of goods
and services, all other factors being constant. Advocates of GPI assert that in some situations,
expanded production facilities damage the health, culture, and welfare of people. Growth that
was in excess of sustainable norms had to be considered to be uneconomic
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the maximum and minimum values for life expectancy were 85 and 25 years, Adult literacy
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rate (%) 100 and 0, Combined gross enrolment ratio (%) 100 and 0, GDP per capita (US$)
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40,000 and100 respectively. Performance in each dimension is expressed as a value between 0
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and 1. The HDI is then calculated as a simple average of the dimension indices:
HDI = 1/3 (life expectancy index) + 1/3 (education index) + 1/3 (GDP index)
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Inconsistencies among indicators- Despite references to seemingly identical indicators,
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there exists differences in the definition, in the use of data sources, in the compilation method,
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in the periodicity etc., which lead to different numerical values.
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Validity of indicators- Sources, definitions and compilation/ estimation methods are not
always made explicit. The lack of adequate referencing and of technical notes deprives the user
of making an informed quality assessment.
Separation of indicator development from basic data collection at country level-
Insufficient attention is given to improving the quality and comprehensiveness of basic data
from which indicators are derived.
Overburdening of national statistical systems- Competing demands and poor overlap1
of internationally formulated indicator sets increase the reporting burden of national statistical
agencies. Ad hoc requests by international agencies lead to ad hoc data collection, crowding
out limited financial and human resources and, thus, interfering with regular national statistical
programmes.
Inefficient use of statistical resources- At present agencies does not share information
coming from the country level optimally. There are potential efficiency gains by organizing
better the flow of information.
Review Questions
i) Differentiate between economic growth and economic development
ii) Distinguish between GDP and GNP
iii) Discuss the limitations of GDP as measure of economic wellbeing
iv) Describe the GPI as a measure of development
v) Assume the following parameter were taken from the National Beareau of Statistics of
Kenya in the year 2004:
a) Life expectancy- 50.7 years
b) Adult literacy rate- 47.8%
c) Combined gross enrolment ratio- 50.2
d) GDP per capita- 792 USD (PPP)
Using the UNDP goal post for the year in question (refer to the chapter), caculate
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Kenya’s HDI
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vi) Describe the main problems of development indicators
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vii) What are the presumed benefits of genuine progress indicator over gross domestic
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product as measures of development
viii) Describe the following methods of measuring GDP
a) Expenditure Method
b) Income Method
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CHAPTER THREE
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DEVELOPMENT STRATEGIES
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Learning Objectives
By the end of this chapter the learner should be able to:
i) Discuss the role of science and technology in development
ii) Differentiate between industrialization and modernization as development
approaches
iii) Discuss the concept of participatory development
iv) Describe various national sustainable development strategies
v) Explain the role of co-operatives in development
vi) Explain the role of regional integration in development
Industrialization
In its broadest sense, industry is any work that is undertaken for economic gain and that
promotes employment. The word may be applied to a wide range of activities, from farming to
manufacturing to tourism. It encompasses production at any scale, from the local—sometimes
known as cottage industry—to the multinational or transnational.
In a more restricted sense, industry refers to the production of goods, especially when
that production is accomplished with machines. It is this limited definition of industry that is
embodied by the notion of industrialization: the transition to an economy based on the large-
scale, machine-assisted production of goods by a concentrated, usually urban, population of
workers. Manufacturing, which literally means "making by hand", has come to describe
mechanical production in factories, mills, and other industrial plants
Classifying Industry
An industry is usually classified as belonging to one of the following four groups:
i) Primarily
ii) Secondary
iii) Tertiary
iv) Quaternary.
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Primary industries, which collect or extract raw materials, are located where the
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resources are found.
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Secondary industries are those that process or convert the raw materials into finished
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products. Some of these manufacturing industries must be situated close to the raw materials
they use, others are tied to their largest markets, and still others—independent of both
resources and markets—are often located wherever it is cheapest at the time.
Tertiary industries are the service industries. These include retailing, wholesaling,
transport, public administration, and the professions, such as law.
Quaternary industries comprise activities that provide expertise and information.
Consultancy services and research organizations belong to this category. These are generally
market oriented, but since electronic communication permits swift contact and the easy
transmission of data, they may be located almost anywhere.
Industrial Transition
Changes to the industrial structure of a country can be measured using either the value
of manufactured output or alterations to the employment structure. For the established
industrial nations, there has been a clear shift in the relative importance of different types of
industry, and this has been accompanied by a change in employment. Since the mid-19th
century, the proportion of the US workforce employed in primary industry has declined from
about 70 per cent to its present level of just 3 per cent. Employment in secondary industry
reached a peak of 30 per cent in the 1950s, after which it dropped back to 23 per cent. Tertiary
and quaternary industries now employ 74 per cent of the workforce.
The corresponding figures for the UK are nearly identical: primary industry has just 2
per cent, secondary 23 per cent, and tertiary and quaternary 75 per cent of the workforce. In
Germany, the distribution is 3 per cent in primary industry, 37 per cent in secondary, and 60
per cent in tertiary and quaternary.
These figures stand in marked contrast to those of the Emerging and Less Developed
Ccountries (ELDCs). In India, for example, 65 per cent of the workforce is engaged in primary
industry, 19 per cent in secondary, and 11 per cent in tertiary. Not all ELDCs display similar
figures, however-much depends on their history and their links with the rest of the world. In
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Nigeria and South Africa, for example, approximately 44 per cent and 50 per cent of the
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workforce respectively is engaged in tertiary activity.
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De-industrialization
De-industrialization describes the decline in the contribution made by manufacturing
industry to a nation's overall economic prosperity. The process might better be termed re-
industrialization, because the shift is not away from industry altogether, but from secondary to
tertiary and quaternary industry. In other words, a de-industrializing economy moves away
from the manufacture of goods and towards the provision of services.
Those countries to industrialize first—the UK, France, and the United States—are now
undergoing de-industrialization. The ascendancy of the service economy in the context of the
post-industrial society is characterized by a number of apparently negative features, such as a
decline in manufacturing employment and a dependence on imports across a wide range of
sectors.
Although the loss of the manufacturing base is likely to create unemployment at first, it
may not be an adverse development in the long term. Ironically, de-industrialization in the
three countries mentioned above has been accompanied by a growth in the high-tech industries
in areas such as the Côte d’ Azur in France; Silicon Valley in California; and along the M4
motorway, around Cambridge, and in central Scotland—the so-called Silicon Glen—in the
UK. The long-term impact of de-industrialization has yet to be felt. It may be the speed of the
process, rather than the process itself, that needs careful management.
Transnational Corporations
Probably the most significant industrial development since the 1960s has been the rise
of the multinational or transnational company. Examples of these companies, which operate in
many countries, are Ford, General Motors, IBM, Siemens, and Matsushita Electrical. United
Nations (UN) estimates that investment by transnational companies has risen by 13 per cent
per year over the last 20 years, largely because more and more governments are accepting
these firms into their countries.
Nevertheless, the growth of multinational corporations has raised a number of concerns.
An enormous amount of production power is concentrated in the hands of a few controllers,
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which means that the countries involved become directly susceptible to economic changes in
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other parts of the world. The transfer of assets from one country to another may be difficult for
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governments to manage or prevent, and there are likely to be disparities in the treatment of
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different countries.
Manufacturing countries experiencing the decline of home-based industry, such as the
UK, have proved attractive targets for multinationals. So have countries in Asia and South
America, where energy and labour are relatively inexpensive. By contrast, few African
countries have benefited from investment by transnational corporations because of the general
lack of skilled workforce and adequate infrastructure. Not all transnational have their origins in
the developed nations. The development of such companies is encouraged in the NICs as a
means of securing expanding export markets.
Consequences of Industrialization
Most countries regard industrialization as a positive development capable of generating
rapid wealth, revitalizing run-down areas, and conferring influence in world affairs. Most also
now recognize the need for a diversified industrial base to safeguard their economies from
fluctuations in the market price for their own specialized product.
Industrialization schemes commonly require a parallel development of energy sources. In the
case of hydroelectric plants, there is social dislocation, since large areas may be flooded to
create the necessary water reserves behind the so-called super-dams.
Environmental safeguards may be overlooked, leading to serious problems of air, land,
and water pollution. One of the worst incidents occurred in Minamata, Japan, where mercury
residues from nearby chemical plants contaminated the water of Minamata Bay, were ingested
by fish, and then entered the human food chain to cause death and illness for up to 30 years
after the event. Another notorious example was Bhopal, India, where a leak of poisonous gas
killed thousands of people and blinded or otherwise injured many others.
In Europe, the North Sea is suffering from the effects of industrial waste, thermal
pollution from power stations, atmospheric fallout containing high levels of lead, oil spilled
form ships, and radioactive materials from nuclear power stations. Increasing industrialization
means that pressures to conserve resources are rising.
Urbanization and associated problems such as housing, crime unemployment etc
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The Future of Industry
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Several trends are likely in the global pattern of industrialization. First, only certain countries,
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and not the world as a whole, may experience a post-industrial future.
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A second trend will be the efficient and careful use of resources and the growth in
recycling as the concept of sustainability becomes better established. Recycling industries are a
growth area themselves, and established manufacturers are increasingly operating product-
recycling schemes.
A final trend will be the growing need for alternative technologies to reduce the
consumption of resources for industrial production and to protect the natural environment.
Worldwide cooperation will be necessary if all nations are to gain from the potential benefits of
industry.
Modernization
Modernization is a concept used in sociology and politics. It is the view that a standard,
teleological (the explanation of phenomena by the purpose they serve rather than by postulated
causes) evolutionary pattern, as described in the social evolutionism theories, exists as a
template for all nations and peoples
According to theories of modernization, each society would evolve inexorably from
barbarism to ever greater levels of development and civilization. The more modern states
would be wealthier and more powerful, and their citizens freer and having a higher standard of
living. According to the Social theorist Peter Wagner, modernization can be seen as processes,
and as offensives.
The former view suggests that it is developments, such as new data technology or dated
laws, which make modernization necessary or preferable. This view makes critique of
modernization difficult, since it implies that it is these developments which control the limits of
human interaction, and not vice versa.
The latter view of modernization as offensives argues that both the developments and
the altered opportunities made available by these developments are shaped and controlled by
human agents. The view of modernization as offensives therefore sees it as a product of human
planning and action, an active process capable of being both changed and criticized. This was
the standard view in the social sciences for many decades. It was also viewed as a
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"development of the rational and universal mind towards self-consciousness and freedom."
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This theory stressed the importance of societies being open to change and saw reactionary
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forces as restricting development. Maintaining tradition for tradition's sake was thought to be
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harmful to progress and development.
This approach has been heavily criticized, mainly because it conflated modernization
with westernization. In this model, the modernization of a society required the destruction of
the indigenous culture and its replacement by a more westernized one. Technically modernity
simply refers to the present, and any society still in existence is therefore modern.
Proponents of modernization typically view only Western society as being truly modern
arguing that others are primitive or ‘unevolved’ by comparison. This view sees ‘unmodernized’
societies as inferior even if they have the same standard of living as western societies.
Opponents of this view argue that modernity is independent of culture and can be
adapted to any society. Japan is cited as an example by both sides. Some see it as proof that a
thoroughly modern way of life can exist in a non-western society. Others argue that Japan has
become distinctly more western as a result of its modernization. In addition, this view is
accused of being Eurocentric, as modernization began in Europe with the industrial revolution.
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and demonstration, RD&D. When all goes well, RD&D is followed by a ‘third D’—the
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deployment phase— wherein demonstrated technologies cross the threshold to commercial
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viability and gain acceptance in the marketplace. Typically, government’s role is most
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pronounced in the early research and development phases of this progression while the private
sector plays a larger role in the demonstration and deployment phases. Nevertheless,
government can also make an important contribution in the demonstration and early
deployment phases, for example, by funding demonstration projects, providing financial
incentives to overcome early deployment hurdles, and helping to create a market for new
technologies through purchasing and other policies.
Many demonstrated technologies encounter significant market hurdles as they
approach the deployment phase; for some—hybrid vehicles, hydrogen as a transport fuel, solar
energy, coal-based integrated gasification combined cycle (IGCC), and fuel cells— cost rather
than technological feasibility becomes the central issue. Established private-sector stakeholders
can be expected to resist, or even actively undermine, the deployment of new technologies,
thus necessitating additional policy interventions.
Participatory Development
The meaning of “participation” is often a rendition of the organizational culture
defining it. Participation has been variously described as a means and an end, as essential
within agencies as it is in the field and as an educational and empowering process necessary to
correct power imbalances between rich and poor. It has been broadly conceived to embrace the
idea that all “stakeholders” should take part in decision making and it has been more narrowly
described as the extraction of local knowledge to design programs off site. Differences in
definitions and methods aside, there is some common agreement concerning what constitutes
authentic “participation”.
Participation is involvement by a local population and, at times, additional stakeholders
in the creation, content and conduct of a program or policy designed to change their lives. Built
on a belief that citizens can be trusted to shape their own future, participatory development
uses local decision making and capacities to steer and define the nature of an intervention.
Participation requires recognition and use of local capacities and avoids the imposition of
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priorities from the outside. It increases the odds that a program will be on target and its results
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will more likely be sustainable.
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Ultimately, participatory development is driven by a belief in the importance of
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entrusting citizens with the responsibility to shape their own future, systems and as resources,
from salaries to food parcels and reconstruction materials are delivered. With no awareness of
social or political context it is never certain if an intervention is warranted at all. And when
there is blind engagement, ignorance of context makes each choice a round of roulette,
potentially explosive and liable to overrun the self-development potential of the target
population while undermining the effectiveness of assistance delivery in the first place. At
worst, we aid and abet the violence and become accomplices to adversity. Participatory
methodologies, as part of political development programs or not, increase awareness of the
social and political context and better the odds this will be avoided.
Four separate studies of participatory programming have found that such methods often
cost less in the long run and are consistently more effective at getting assistance where it needs
to go. Such methods were also found to be unmatched in fostering sustainability, strengthening
local self-help capacities and in improving the status of women and youth. Finally, by
establishing platforms where organizations may access and involve citizens in their programs,
participatory development methods often extended the reach of traditional development
approaches by leveraging local resources with national and foreign assets.
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to the project and thus facilitate the diagnosis of environmental, social and institutional
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constraints as well as the search for viable solutions;
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Adoption of innovations- the beneficiaries can develop greater responsiveness to new methods
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of production, technologies as well as services offered;
Production- higher production levels can be achieved while ensuring more equitable
distribution of benefits;
Successful results- more and better outputs and impact are obtained in a project and thus
longer-term viability and more solid sustainability. By stressing decentralization, democratic
processes of decision-making and self-help, various key problems can be better solved,
including recurrent costs, cost-sharing with beneficiaries as well as operation and maintenance;
Self-reliance- this broad, ultimate objective embraces all the positive effects of genuine
participation by rural people. Self-reliance demolishes their over-dependency attitudes,
enhances awareness, confidence and self-initiative. It also increases people's control over
resources and development efforts, enables them to plan and implement and also to participate
in development efforts at levels beyond their community
Supporting institutions like government agencies and NGOs can fulfill better their mandates
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The continuous improvement approach to managing development strategies
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Leadership – “developing an underlying vision through consensual, effective and iterative
process; and going on to set objectives”. Leadership is perhaps the most critical aspect of
strategic management. Through a consultative process, it provides the vision for development
activities and services. At its foundation, leadership must be grounded in the fundamental
principles of sustainable development, that is, it must represent both existing and future
generations, and it must understand the interdependency among economic, social and
environmental systems. It requires identification of:
i) Type of strategy approach
ii) Demonstrating commitment and focus
iii) Incorporating the inter-generational SD principle
iv) Incorporating the interdependency SD principle
Some of the characteristics of leadership include the following:
i) people-centered approach;
ii) strong political commitment;
iii) consensus and long-term vision;
iv) sound leadership and good governance;
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v) comprehensive and integrated (economic, social, and environmental; inter-
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generational consideration);
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vi) shared strategic and pragmatic vision;
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vii) comprehensive and reliable analysis;
viii) linking short-term to medium and long-term;
ix) country led and nationally owned;
x) effective participation; and
xi) Realistic and flexible targets.
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Cross-Sectoral SD strategies relating to specific dimensions of SD
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A strategy that spans multiple sectors and covers one or two dimensions of sustainable
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development, e.g., national environmental management plans or poverty reduction strategy
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papers (PRSPs). PRSPs describe a country’s macroeconomic, structural, and social policies in
support of growth and poverty reduction, as well as associated external financing needs and
major sources of financing.
Sectoral SD strategies
A strategy that incorporates economic, social and environmental dimensions of SD, but
that is focused on a specific sector. Rather than create a single, national strategy for the
government, responsibility for sustainable development to individual government departments
and agencies (e.g., SD strategy for a ministry of transportation).
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Regional Integration
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Regional integration refers to the process by which states within a particular region
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increase their level of interaction with regard to economic, security, political, and also social
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and cultural issues. Regional integration arrangements are mainly the outcome of necessity felt
by nation-states to integrate their economies in order to achieve rapid economic development,
decrease conflict, and build mutual trusts between the integrated units
Closer integration of neighboring economies is seen as a first step in creating a larger
regional market for trade and investment. This works as a spur to greater efficiency,
productivity gain and competitiveness, not just by lowering border barriers, but by reducing
other costs and risks of trade and investment. Bilateral and sub-regional trading arrangements
are advocated as development tools as they encourage a shift towards greater market openness.
Such agreements can also reduce the risk of reversion towards protectionism, locking in
reforms already made and encouraging further structural adjustment.
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It’s vital to note that Cooperatives provide organizational framework which enables the
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members of the community to handle tasks that enhance production and productivity,
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marketing and value addition, employment creation thus enhancing incomes and meeting
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social needs.
For cooperatives to succeed and also benefit the owners, the value of self help must be
fully embraced. However, More often than not, one hears a question like what has a
cooperative done to assist its members, and yet the valid question would have been how the
members have utilized the cooperatives to enhance the socio economic status? Cooperatives
differ from other forms of businesses in that they are member centered as contrasted to
companies where capital is at the centre in order to earn profits.
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Financial intermediation: Availability of financial services helps farmers in a number
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of ways.
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Farmers can be able to get in puts in time through the available credit services. Secondly when
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farmers products are bulked in the stores while awaiting better markets, farmers can borrow
from their own SACCOs to cater for their pressing needs as they wait for marketing of their
products.
Social services provision: These include among others health, housing, utilities e.g. rain
water harvesting, solar power scheme, and transport-bodaboda.
Human resources development: All round training is always provided to membership,
staff and leaders of any genuine and well performing cooperative organization
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ecosystems. The poor suffer disproportionately from over-exploitation and degradation of
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resources, yet they lack sufficient political or economic representation.
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Disputes over natural resources could therefore arise for a number of reasons: Actions
of one group may intentionally or unintentionally impinge upon the ecological well-being of
others. Those with greater access to power also tend to control natural resource use and
distribution. As well, rapid environmental change, unequal distribution of power, and changing
consumption patterns exacerbate natural resource scarcity. This can lead to fierce competition
between groups impacting on development negatively. Finally, people define natural resources
in ideological, social, and political terms. Thus, land, forests, and waterways not only represent
material resources that people struggle over, but are often culturally and symbolically
important.
Because natural resource conflicts are complex, pluralistic approaches are more
effective in identifying barriers to progress and peace building strategies. Multi-stakeholder
analysis, in particular, offers researchers and policymakers an effective means of understanding
the different interests and power relations among those involved. Various research methods can
further enhance this approach. They include participatory rural appraisal, participatory action
research, gender analysis, and the analysis of differences in class interests and power relations.
Greater opportunities for change emerge when local stakeholders are involved in analyzing the
causes and alternatives to conflict.
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insights, and resources. Even more important, they note, conflict itself may be a catalyst for
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positive social change in certain circumstances, but only if violence can be avoided.
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Review Questions
i) As a development approach, is modernization the same as industrialization? Justify
your answer
ii) What is the role of science and technology in development?
iii) What the rationale of participatory development as a development strategy?
iv) Describe the following national sustainable development strategies
a) Comprehensive, multi-dimensional SD strategy
b) Cross-Sectoral SD strategies relating to specific dimensions of SD
v) What are the guiding principles of sustainable development strategies?
vi) Explain the contribution of co-operatives in development
vii) Explain the functions of regional integration in development
viii) What are the main causes of disputes over natural resources?
ix) Describe the negative impacts of industrialization
x) Describe the continuous improvement approach to the management of development
strategies
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CHAPTER FOUR
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POPULATION AND DEVELOPMENT
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Learning Objectives
By the end of this chapter the learner should be able to:
i) Discuss the impact of demographics on development
ii) Describe the various concepts of poverty and its measurement
iii) Calculate the Gini coefficient of inequality
iv) Explain the factors precipitating rural-urban migration
Population
Before the industrial revolution population growth was held in check by high mortality
rates, which were accompanying high birth rates. The source of high mortality rates in a
classical Malthusian perspective could have been the limitation in the amount of available
agricultural resources, either continuously, leading to poor nutrition (and therefore to higher
morbidity and premature deaths), or episodically, through famines. But there were also other
forces at play.
First of all very high rates of child mortality, either through systematic infanticide
(itself probably a function of available resources), especially of females, or as a consequences
of neglect and of poor living, childbearing, and childrearing conditions
Second, possible neglect of the elders, the disabled and the infirm and the spread of
epidemic diseases (which was favored by overcrowding and poor living conditions in the cities
of agricultural societies),
Third endemic warfare, between tribes, nations or individuals, leading to direct deaths
as well as to the misdirection and destruction of the resources otherwise available for survival.
Still, following the improvements of agricultural technology in particular, there was some
population growth at a very slow pace, slightly accelerating in time.
Later on, especially since the half of the nineteenth century, the decrease in mortality
rates (a true “mortality revolution” “which has resulted in doubling or more of average life
expectancy at birth” and has been the direct consequence of the diffusion of medical
knowledge and discoveries that has followed with some delay the Industrial Revolution) has
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led to a much faster population growth, while the demographic consequences of two world
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wars and related upheavals are shown in a temporary decrease of growth rates.
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The post World War II period has seen an unprecedented population explosion, with
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some signs of abating however following increasing living standards and progresses in the
technology of birth control, In Malthus’ own words: “The positive checks to population are
extremely various, and include every cause, whether arising from vice or misery, which in any
degree contributes to shorten the natural duration of human life. Under this head, therefore,
may be enumerated all unwholesome occupations, severe labour and exposure to the seasons,
extreme poverty, bad nursing of children, great towns, excesses of all kinds, the whole train of
common diseases and epidemics, wars, plague, and famine.”
According to Ember (1978) about 60% of the societies of hunter gatherers of which
there is documentation were recorded to be at war at least once every two years. As to pre-
industrial civilizations it is enough to recall world and European history (for instance,
considering European history immediately preceding the Industrial Revolution, in the 16th
century 95% of the time there were wars involving the major European powers, 94% in the
17th and 78% in the 18th century. The table below shows the trend in human population
growth in the course of history.
Human population in the course of history (in millions)
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Poverty
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The concept of poverty is plagued by a conceptual complexity that can be best
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described as a series of fault lines. These are:
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Individual or household measures- Early measurement of poverty (e.g. by Rowntree)
was at the household level, and much still is. Other analysis disaggregates to the individual
level, so as to capture intra-household factors and different types and causes of deprivation
affecting men, women, children, old people, etc.
Private consumption only or private consumption plus publicly provided goods-
Poverty can be defined in terms of private income or consumption (usually consumption rather
than income, in order to allow for consumption smoothing over time, e.g. by managing
savings), or to include the value of goods and services provided publicly, the social wage
Monetary or monetary plus non-monetary components of poverty- So-called money-
metric measures are often used, because they are either regarded as sufficient on their own or
seen as an adequate proxy for poverty. However, there is a clear fault line between definitions
of poverty which are restricted to income (or consumption) and those which incorporate such
factors as autonomy, self-esteem or participation.
In Maslow’s hierarchy of needs, these were seen as higher needs, which would become
more important as basic needs for food, shelter, housing and safety were met. However, many
current definitions deliberately blur the distinction between higher and lower needs.
Snapshot or timeline- Many surveys and poverty assessments report the incidence of
poverty at a point in time. However, there is a long history of thinking about poverty in terms
of life cycle experience (e.g. Chayanov’s pioneering work in the 1920s on the peasant
household), seasonal stress, and shocks (illness, drought, war). In both North and South, there
has been increasing attention to understanding movement in and out of poverty, what Jenkins
calls ‘bottom-end churning’. Panel surveys, which track a fixed group of individuals over time,
provide data.
Actual or potential poverty- Some analysts include as poor those who are highly
sensitive to shocks, or not resilient. Small-scale pastoralists exposed to the risk of drought are a
common example: current income may be adequate, but vulnerability is high. Planning for
these groups means understanding both short-term coping strategies, and also long-term
adaptation to livelihood stress.
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Stock or flow measures of poverty- The definition of poverty as income focuses on the
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flow of material goods and services. An alternative is to examine the stock of resources a
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household controls. This may be measured in terms of physical or monetary assets (land,
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jewellery, cash), or in terms of social capital (social contacts, networks, reciprocal
relationships, community membership).
Sen analyzed the commodity bundles to which an individual was ‘entitled’: as Swift has
emphasized, entitlements may derive not just from current income, but also from past
investments, stores or social claims on others (including the State).
Input or output measures- Sen has reminded us that poverty measured as a shortfall in
income essentially captures an input to an individual’s capability and functioning rather than a
direct measure of well-being. Writing about poverty has often assumed, wrongly, an automatic
link between income and participation, or functioning, in the life of a community.
Absolute or relative poverty- The World Bank currently uses a figure of $US1 per day
for absolute extreme poverty and $US2 for poverty. The alternative has been to define poverty
as relative deprivation, for example as half mean income, or as exclusion from participation in
society. Thus the European Union has decided that ‘the poor shall be taken to mean persons,
families and groups of persons whose resources (material, cultural, social) are so limited as to
exclude them from the minimum acceptable way of life in the member state in which they
live’.
Objective or subjective perceptions of poverty- The use of participatory methods has
greatly encouraged an epistemology of poverty which relies on local understanding and
perceptions. For example, exposure to domestic violence may be seen as important in one
community, dependency on traditional structures in another.
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Second, most observers would include income obtained from common property and
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state provided commodities, particularly social welfare payments, though not always health
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and education provision.
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Third, there is again little dissent from the view that people move in and out of poverty,
and that seasonal, cyclical or stochastic shocks are important. For example, the distinction
between chronic and transitory food security is mirrored in writing about poverty.
Fourth, relative poverty and relative deprivation are accepted as relevant, at least in
theory. In developing countries, most definitions of poverty still rely on calculation of the cost
of a basket of basic needs, but distribution data are normally provided.
Beyond these areas of agreement, there are different views on whether assets, including
social claims, should be counted in a poverty matrix, on the importance of vulnerability, and on
the relative prioritization of monetary and non-monetary variables. The most radical
proponents of a participatory approach would deny the validity of standardized, so-called
objective measures of poverty, whether based on income or wealth. Chambers, for example,
has argued that these approaches are reductionist.
This can be problematic. Baulch has pointed out that there is an important trade-off
between being able to identify the poor using local indicators, and being able to aggregate the
results into meaningful, national or international figures: objective measures of poverty present
numerous problems in terms of identifying the poor, but succeed in providing the aggregate
statistics policy maker’s desire.
Indicators of Poverty
There is nothing inherently wrong with setting targets and measuring progress towards
them; nor with developing indicators useful for resource allocation. However, different models
of poverty imply different indicators.
i) Money metric models require information on income or consumption;
ii) vulnerability models use indicators of wealth and exposure to risk, as well as
income;
iii) models concerned with capability and functioning present indicators of life
expectancy or educational achievement;
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iv) Models of well-being or social exclusion will include measures like the degree
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of social support.
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It is frequent practice, however, to present a wider set of indicators than is immediately
required. For example, World Bank poverty assessments, concentrating on money metric
measures, will also provide evidence on health, education, physical isolation, and other so-
called correlates of poverty. Some indicators are inherently more quantifiable than others, and
more decomposable, in the sense that they can be subjected to statistical manipulation. Other
measures of poverty are more qualitative and/or more location-specific, and cannot so easily be
aggregated.
Inequality
While a considerable share of the world population still lives in poverty, world income
and wealth are very unequally distributed. Recent research shows the extent of world
inequality in the distribution of personal wealth: The 24 richer OECD countries own 83% of
world private wealth. The 64 poorest countries with 40% of world population own 2% of world
personal wealth. In 2000 the 1% richest adults owned the 40% of overall private wealth the
richest 10%, 85%; the poorest 50%, 1%.
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The Lorenz curve is the plot of the cumulative income share L against the cumulative
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population share p as shown in the figure below.
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The Gini coefficient (or "Gini index" or "Gini ratio") G is calculated from the Lorenz
curve as the ratio G = Area A/ (Area A + Area B). Note that (Area A + Area B) is the area of a
triangle, given by 100*100/2=5000.
The Gini coefficient for the 1983 U.S. family income distribution is given by the
following calculations.
Calculation of Gini Coefficient
Area A + Area B 100*100/2 = 5000
Area 1 20*4.7/2 = 47
Area 2 20*(4.7+15.8)/2 = 205
Area 3 20*(15.8+32.9)/2 = 487
Area 4 20*(32.9+57.3)/2 = 902
Area 5 20*(57.3+100)/2 = 1573
Total Area B 3214
Area A 5000 - 3214 = 1786
Gini Coefficient 1786/5000 = 0.36 or 36%
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Thus the Gini coefficient in this example is 1786/5000 = 0.36 or 36%.
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the closer the Lorenz curve is to the line of perfect equality, the less the inequality and the
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smaller the Gini coefficient.
The Gini index of inequality of overall world wealth distribution (calculated using
current exchange rates) is given as 89 Income is distributed less unequally than wealth, but still
in a markedly unequal way. According to most estimates the Gini coefficient of world income
distribution is around 65% in the contemporary world. To make a comparison, the Gini index
of the distribution of family incomes of Italy is reported as 36, that of the USA 45, that of
Sweden 25.
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Rural Urban Migration
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Review Questions
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i) The post world war II period has seen an unprecedented explosion in human
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population. What factors have precipitated this phenomenon and what is its impact on
development if any?
ii) Describe some of the divergent views on the definition of poverty and its measurement
iii) Assume the following figures were obtained from the National Bureau of Statistics of
Switzerland in the year 2008
Income Category Share of Total Income (%)
Top 10% 22.8
th
9 10% 19.9
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8 10% 14.3
th
7 10% 10.1
th
6 10% 9.1
th
5 10% 8.0
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4 10% 6.8
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3 10% 4.3
nd
2 10% 3.5
Lowest 10% 1.2
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CHAPTER FIVE
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GENDER AND DEVELOPMENT
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Learning Objectives
By the end of this chapter the learner should be able to:
i) Define the various concepts of gender
ii) Explain the rationale for gender mainstreaming
iii) Explain the concept of affirmative action
iv) Discuss the justifications for affirmative action
Concepts of Gender
Culture-The distinctive patterns of ideas, beliefs, and norms which characterize the way
of life and relations of a society or group within a society
Gender Analysis- The systematic gathering and examination of information on gender
differences and social relations in order to identify understand and redress inequities based on
gender
Gender Discrimination- The systematic, unfavorable treatment of individuals on the
basis of their gender, which denies them rights, opportunities or resources
Gender Division of Labour- The socially determined ideas and practices which define
what roles and activities are deemed appropriate for women and men
Gender Equality and Equity- Gender equality denotes women having the same
opportunities in life as men, including the ability to participate in the public sphere. Gender
equity denotes the equivalence in life outcomes for women and men, recognizing their
different needs and interests, and requiring a redistribution of power and resources
Gender Needs- Shared and prioritized needs identified by women that arise from their
common experiences as a gender
Gender Planning- The technical and political processes and procedures necessary to
implement gender-sensitive policy
Gender Relations- Hierarchical relations of power between women and men that tend
to disadvantage women
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Gender Training- A facilitated process of developing awareness and capacity on gender
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issues, to bring about personal or organizational change for gender equality
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Gender Violence- Any act or threat by men or male-dominated institutions, which
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inflicts physical, sexual, or psychological harm on a woman or girl because of their gender
Intra-household Resource Distribution- The dynamics of how different resources that
are generated within or which come into the household are accessed and controlled by its
members
National Machineries for Women- Agencies with a mandate for the advancement of
women established within and by governments for integrating gender concerns in development
policy and planning
Patriarchy- Systemic societal structures that institutionalize male physical, social and
economic power over women
Sex and Gender- Sex refers to the biological characteristics that categorize someone as
either female or male; whereas gender refers to the socially determined ideas and practices of
what it is to be female or male
Social Justice- Fairness and equity as a right for all in the outcomes of development,
through processes of social transformation
WID/GAD- The WID (or Women in Development) approach calls for greater attention
to women in development policy and practice, and emphasizes the need to integrate them into
the development process In contrast, the GAD (or Gender and Development) approach focuses
on the socially constructed basis of differences between men and women and emphasizes the
need to challenge existing gender roles and relations
Women’s Empowerment- A ‘bottom-up’ process of transforming gender power
relations, through individuals or groups developing awareness of women’s subordination and
building their capacity to challenge it
Women’s Human Rights- The recognition that women’s rights are human rights and
that women experience injustices solely because of their gender
Gender Mainstreaming
Gender mainstreaming is an organizational strategy to bring a gender perspective to all
aspects of an institution’s policy and activities, through building gender capacity and
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accountability. The 1970s strategies of integrating women into development by establishing
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separate women’s units or programmes within state and development institutions had made
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slow progress by the mid- 1980s (See National Machineries for Women). In light of this, the
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need was identified for broader institutional change if pervasive male advantage was to be
challenged.
Adding women- specific activities at the margin was no longer seen as sufficient. Most
major development organizations and many governments have now embraced ‘gender
mainstreaming’ as a strategy for moving towards gender equality.
With a mainstreaming strategy, gender concerns are seen as important to all aspects of
development; for all sectors and areas of activity, and a fundamental part of the planning
process.
Responsibility for the implementation of gender policy is diffused across the
organizational structure, rather than concentrated in a small central unit.
Such a process of mainstreaming has been seen to take one of two forms. The agenda-setting
approach to mainstreaming seeks to transform the development agenda itself whilst prioritizing
gender concerns.
The more politically acceptable integrationist approach brings women’s and gender
concerns into all of the existing policies and programmes, focusing on adapting institutional
procedures to achieve this. In both cases, political as well as technical skills are essential to a
mainstreaming strategy.
Any approach to mainstreaming requires sufficient resources, as well as high-level
commitment and authority. A combined strategy can be particularly powerful. This involves
the synergy of a catalytic central gender unit with a cross-sectoral policy oversight and
monitoring role, combined with a web of gender specialists across the institution. The building
of alliances both within the institution and with outside constituencies, such as women’s
organizations, is crucial for success. Mainstreaming tools include gender training, introducing
incentive structures which reward efforts on gender, and the development of gender-specific
operational tools such as checklists and guidelines.
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Rationale for Mainstreaming Gender
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i) Recognition that development policies impact female and male differently hence the
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need to ensure that the needs of both are taken on board during policy development,
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implementation, monitoring and evaluation
ii) The need of collective process of articulating a shared vision of sustainable human
development and translating it into reality (through policy, programmes and budgets)
hence the need for the effective participation of both women and men.
iii) Recognition of the need for a combined strategy to address women empowerment
issues including selected focus of channeling assistance to women, as a target group,
to a more mainstreaming approach of promoting gender equality as a development
goal.
iv) It is a commitment to ensure concerns and experiences of both women and men are
integral to the design, implementation, monitoring and evaluation of all legislation,
policies and programmes
v) It concerns the staffing, procedures, programmes and culture of development
organizations
vi) Recognizes gender equality as critical to the achievement of other development goals
including poverty reduction.
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Rationale for Affirmative action
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blindness or gender-blindness would not suffice to change the situation for several reasons:
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i) Discrimination practices of the past preclude the acquisition of 'merit' by limiting
access to educational opportunities and job experiences.
ii) Ostensible measures of 'merit' might well be biased toward the same groups who
were already empowered.
iii) Regardless of overt principles, people already in positions of power will be likely
to hire people they already knew, and/or people from similar backgrounds.
In such a circumstance, proponents believe government action giving members of the
group preferential treatment is necessary in order to achieve a proportionate distribution.
From its outset, affirmative action was seen as a transitional strategy, with the intent that over
some period of time- variously estimated from a generation to a century- the effects of past
discrimination would be sufficiently countered that such a strategy would no longer be
necessary: the power elite would reflect the demographics of society at large.
Affirmative action in Kenya in has mainly been on gender and earlier on for
marginalized areas. Affirmative action in South Africa is designed to correct the systemic
effects of discrimination created by Apartheid. Though affirmative action in the U.S. is
primarily associated with racial issues, the American civil rights movement originally gave as
its purpose the correction of a history of oppression against all working-class and low-income
people, and women have figured as prominently as ethnic minorities among its beneficiaries.
Review Questions
i) Define the following concepts of gender rand provide specific examples from the
Kenyan setting
a) National Machineries for Women
b) Gender Relations
c) Gender Needs
d) Gender Discrimination
e) Gender Equality and Equity
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ii) What is gender mainstreaming?
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South Africa and USA
v) Discuss the justifications for affirmative action
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CHAPTER SIX
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ECONOMIC LIBERALIZATION
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Learning Objectives
By the end of this chapter the learner should be able to:
i) Define the term economic liberalization
ii) Define the term structural adjustment
iii) State the measures taken to liberalize the Kenyan economy in the 80s and
90s
iv) Discuss the effects of structural adjustment programs had on Kenya
v) Define the role of foreign direct investments for developing countries
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most social services were lowered they were replaced with user charges under cost sharing
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schemes.
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Devaluation and later floating of the Kenya Shilling- This was accompanied by the
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removal of almost all foreign exchange controls and restrictions. Kenya is now pursuing a
liberal foreign exchange policy. Immediately after this the Shilling depreciated sharply, a
process similar to devaluation.
Divestiture of the Government from the private sector- The Government has embarked
on a momentous programme of divesting itself from economic activities which are best
undertaken by the private sector. For example, it disposed of its shares in the Kenya Airways,
Uchumi Supermarkets, HFCK, Kenya Commercial Bank and others to the general public.
Retrenchment in the civil service- The Government has been laying off civil servants
and other workers in state corporations. The main objective of doing this has been to reduce the
wage bill and hence recurrent expenditure in order to release such resources for development
expenditure. Although those laid off were compensated with 'golden handshakes', many of
them squandered this money, thus and ended up poor and desperate.
Reduction in the budget deficit- The Government had been borrowing heavily from
money markets in order to finance the shortfall between revenue and expenditure. This deficit
had exploded over time to unacceptable levels as proportions of national income. Such
borrowing crowded out the private sector from the money markets. As a result private investors
had limited access to loanable funds. Since the private sector is more efficient than the public
sector in the use of scarce resources such as loanable funds, this denied the society the
opportunity to make the best use of its resources.
The Government tried to reduce budget deficits through sharp reductions in public
expenditure coupled with concerted efforts to increase revenue through better taxation policies
and enhanced efficiency in the collection of revenues. Although all sectors were affected by the
reduction in public expenditure, the axe fell more heavily on the social services such as
education and health care. This is mainly because these two sectors have historically accounted
for the lion's share of the country's budgetary resources.
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Effects of Structural Adjustment Programmes
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Adjustment has 'social effects', which are those extending beyond individual
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households to the whole society. For example, in the short run macro-economic adjustment
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reduces the overall level of income in the economy, which translates to lower incomes for most
households. Structural adjustment programmes have both direct and indirect effects on the
political structures of an adjusting country. This is because they change the political attitudes
and behavior of those who gain or lose as a result of the adjustment processes.
Adjustment programmes often have adverse administrative effects. This is because a
cost-recovery programme in a country like Kenya where public sector incomes and wages are
very low tends to encourage mis-appropriation of funds, bribery and general corruption.
SAPs also increase the debt burden of a country in terms of local currency. Therefore in order
to service such debts funds have to be diverted from pressing administrative needs such as the
police force, judiciary, courts, and so on. This reduces the capacity of the society to fight and
manage crime.
In summary, structural adjustment programmes can have serious adverse social effects.
They lead to increased poverty, insecurity, crime and violence. As the poor become more
desperate and destitute, they easily resort to such criminal activities as looting when riots break
out. This is because the poor increasingly ascribe their plight to 'exploitation' by the rich,
especially Asians. These adverse social effects are more profound among the urban poor and
the underclass.
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Review Questions
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i) Define the term economic liberalization
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ii) Define the term structural adjustment
iii) State the measures taken to liberalize the Kenyan economy in the 80s and 90s
iv) Discuss the effects of Structural adjustment programs in Kenya
v) What are the presumed benefits of foreign direct investments in developing countries
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CHAPTER SEVEN
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ETHICS AND CULTURAL VALUES IN DEVELOPMENT
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Learning Objectives
By the end of this chapter the learner should be able to:
i) Define development ethics
ii) Describe the sources of development ethics
iii) Discuss the areas of disagreements in development ethics
iv) Define culture and its role in development
v) Discuss the various models of development and cultural change
Development Ethics
Ethics may be defined as the branch of knowledge concerned with moral principles. It
deals with the principles of right and wrong behavior and the goodness or badness of human
character, the adherence to the code of behavior that is considered right or acceptable.
Development philosophers and other ethicists formulate ethical principles relevant to social
change in poor countries, analyze and assess the moral dimensions of development theories
and seek to resolve the moral quandaries raised in development policies and practice:
i) In what direction and by what means should a society 'develop'?
ii) Who is morally responsible for beneficial change?
iii) What are the obligations, if any, of rich societies (and their citizens) to poor
societies?
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and practice. One of the most important lessons taught by Goulet, is that so-called
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'development', owing to its costs in human suffering and loss of meaning, can amount to 'anti-
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development'.
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A third source of development ethics is the effort of Anglo-American moral
philosophers to deepen and broaden philosophical debate about famine relief and food aid in
the 1970s. Many philosophers debated whether affluent nations (or their citizens) have moral
obligations to aid starving people in poor countries and, if they do, what are the nature, bases
and extent of those obligations. By the early eighties, however, moral philosophers had come
to agree with those development specialists who for many years had believed that famine relief
and food aid were only one part of the solution to the problems of hunger, poverty,
underdevelopment and international injustice. What is needed, argued these philosophers, is
not merely an ethics of aid but a more comprehensive, empirically informed, and policy
relevant 'ethics of Third World development'.
A fourth source of development ethics is the work of Paul Streeten and Amartya Sen.
Both economists have addressed the causes of global economic inequality, hunger and
underdevelopment and attacked these problems with, among other things, a conception of
development explicitly formulated in terms of ethical principles. Building on Streeten's 'basic
human needs' strategy, Sen argues that development should be understood ultimately not as
economic growth, industrialization or modernization, which are at best means (and sometimes
not very good means), but as the expansion of people's 'valuable capabilities and functioning':
'what people can or cannot do, e.g., whether they can live long, escape avoidable morbidity, be
well nourished, be able to read and write and communicate, take part in literary and scientific
pursuits, and so forth.
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ii) What should be a society's basic economic, political and cultural goals and
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strategies, and what principles should inform their selection?
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iii) What moral issues emerge in development policymaking and practice and how
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should they be resolved?
iv) How should the burdens and benefits of development be conceived and
distributed?
v) Who or what should be responsible for bringing about development? A nation's
government, civil society or the market? What role—if any— should more
affluent states, international institutions, and nongovernmental associations and
individuals have in the self-development of poor countries?
vi) What are the most serious local, national and international impediments to good
development?
vii) To what extent, if any, do moral skepticism, moral relativism, national
sovereignty and political realism pose a challenge to this boundary-crossing
ethical inquiry?
viii) Who should decide these questions and by what methods?
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Fifth, these ethicists are aware that what is frequently called 'development'— for
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instance, economic growth—has created as many problems as it has solved. 'Development' can
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be used both descriptively and normatively. In the descriptive sense, 'development' is usually
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identified as the processes of economic growth, industrialization, and modernization that result
in a society's achieving a high (per capita) gross domestic product. So conceived, a 'developed'
society may be either celebrated or criticized. In the normative sense, a developed society,
ranging from villages to national and regional societies, is one whose established institutions
realize or approximate (what the proponent believes to be) worthwhile goals—most centrally,
the overcoming of economic and social deprivation. In order to avoid confusion, when a
normative sense of 'development' is meant, the noun is often preceded by a positive adjective
such as 'good' or 'ethically justified'.
A sixth area of agreement is that development ethics must be conducted at various
levels of generality and specificity. Just as development debates occur at various levels of
abstraction, so development ethics should assess:
i) Basic ethical principles,
ii) Development goals and models such as 'economic growth', 'growth with equity',
'basic needs' and, in the nineties, 'sustainable development', 'structural adjustment'
and 'human development' (United Nations Development Programme), and
iii) Specific institutions and strategies.
Seventh, most development ethicists believe their enterprise should be international in
the triple sense that the ethicists engaged in it come from many nations, including poor ones;
that they are seeking to forge an international consensus; and that this consensus emphasizes a
commitment to alleviating worldwide deprivation.
Eighth, although many development ethicists contend that at least some development
principles or procedures are relevant for any poor country; most agree that development
strategies must be contextually sensitive. What constitutes the best means—for instance, state
provisioning, market mechanisms, civil society and their hybrids—will depend on a society's
history and stage of social change as well as on regional and global forces.
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Areas of Disagreements in Development Ethics
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A first unresolved issue concerns the scope of development ethics. Development ethics
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originated as the 'ethics of Third World Development' there is no consensus, however, on
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whether or not development ethics should extend beyond its central concern of assessing the
development ends and means of poor societies.
Some argue that development ethicists should criticize human deprivation wherever it
exists and that rich countries, since they too have problems of poverty, powerlessness, and
alienation, are 'underdeveloped' and, hence, fall properly within the scope of development
ethics. Others contend that since development ethicists address questions of rich country
responsibility and global distributive justice, they should not restrict themselves to official
development assistance but also should treat international trade, capital flows, migration,
environmental pacts, military intervention, and responses to human rights violations committed
by prior regimes.
The chief argument against extending the boundaries in these ways is that development
ethics would thereby become too ambitious and diffuse. If development ethics grew to be
identical with all social ethics or all international ethics, the result might be that insufficient
attention would be paid to alleviating poverty and powerlessness in poor countries.
Development ethicists also are divided on the status of the moral norms that they seek
to justify and apply. Three positions have emerged. Universalists, argue that development goals
and principles are valid for all societies. Particularists, reply that universalism masks
ethnocentrism and (Northern) cultural imperialism.
A third approach tries to avoid the standoff between the first two positions. On this
view, development ethics should forge a cross-cultural consensus in which a society's own
freedom to make development choices is one among a plurality of fundamental norms and in
which these norms are of sufficient generality so as not only to permit but also to require
sensitivity to societal differences.
Development ethicists also differ with respect to whether (good) societal development
should have—as an ultimate goal—the promotion of values other than the present and future
human good. Some development ethicists ascribe intrinsic value, equal to or even superior to
the good of individual human beings, to human communities of various kinds, for instance,
family, nation or cultural group.
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Others argue that nonhuman individuals and species, as well as ecological
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communities, have equal and even superior value to human individuals. Those committed to
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'eco-development' or 'sustainable development' do not yet agree on what should be sustained as
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an end in itself and what should be maintained as an indispensable or merely helpful means.
Nor do they agree on how to surmount conflicts among intrinsic values.
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culture. Formal recognition of aboriginal peoples and their right to self-determination has
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supported the notion of cultural plurality.
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Models of Development and Cultural Change
Central to the concept of cultural sustainability is an understanding of the process of
change. Cultures evolve; and change is inherent in the life process. Cultural change often
results from an introduction of new ideas or technology or from ecological or economic
change. Cultures, like other systems, tend to seek regularity and equilibrium, but also are faced
with contradictions and conflicts. To resolve these, change takes place. Over the last five
decades, the highly increased pace of change in most cultures around the world underscores the
need to understand the change process. Cultural change can result from many development
approaches. The table below shows models of development that is invariably associated with
some form of cultural change.
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Review Questions
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i) Define development ethics
ii) Define culture and its explain its influence on development activities
iii) Describe the sources of development ethics
iv) State the key questions posed by development ethicists in the development of ethics
in development
v) Discuss the areas of disagreements in development ethics
vi) Define culture and discuss its role in development
vii) Explain the implication of the institutional model of development on cultural
Sustainability
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SAMPLE QUESTION PAPERS
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Mt Kenya University
DEPARTMENT OF BUSINESS AND SOCIAL STUDIES
End of Semester Examination - Aug - Dec, 2009
BBM121/UCU 002: DEVELOPMENT STUDIES
Time: 2 Hrs
Instructions to Candidates: Answer question 1 (Compulsory) and any other TWO questions.
QUESTION 1
a) Discuss the tenets of dependency theories of development (12mks)
b) Discuss the root causes of Africa underdevelopment(9mks)
c) Explain the rationale of gender mainstreaming in development policies(9mks)
QUESTION 2
a) Discuss the benefits of participatory development(12mks)
b) Explain the implications of imperialism model of development on cultural sustainability
(8mks)
QUESTION 3
a) Explain the key principles of sustainable development strategies(12mks)
b) Discuss four challenges of population growth to development in Africa(8mks)
QUESTION 4
a) Discuss the functions of regional integration(12mks)
b) With appropriate examples distinguish between the concepts of gender equity and
equality(8mks)
QUESTION 5
a) Explain the push and pull factors that promote rural urban migration (12mks)
b) Highlight the problems of development indicators(8mks)
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Mt Kenya University
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DEPARTMENT OF BUSINESS AND SOCIAL STUDIES
End of Semester Examination - Oct - Jan, 2009 (Evening Class)
BBM121/UCU002: DEVELOPMENT STUDIES
Time: 2 Hrs
Instructions to Candidates: Answer question 1 (Compulsory) and any other TWO questions.
QUESTION 1
(a) Discuss the limitations of GDP as a measure of economic health (7mks)
(b) Describe the merits of participatory development (6mks)
(c) Discuss the role played by co-operatives in economic development (6mks)
(d) Explain the reasons why disputes arise over natural recourses (6mks)
(e) State the key functions of regional integration (5mks)
QUESTION 2
(a) Discuss the consequences of industrialization (8)
(b) Discuss the tenets of strategy theories of development (12mks)
QUESTION 3
(a) Describe the main areas of consensus for development ethicists (12mks)
(b) De-industrialization describes the decline in the contribution made by manufacturing
industry to a nation's overall economic prosperity. With appropriate examples explain
why this process should rather be referred to re-industrialization (8mks)
QUESTION 4
(a) Discuss the presumed benefits of genuine progress indicator over gross domestic
product as indicators of development (12mks)
(b) Discuss the criticisms leveled against modernization as a model of development
(8mks)
QUESTION 5
(a) Discuss the consequences of population growth to development in Africa (10mks)
(b) Explain the concept of gender planning (10mks)
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DEPARTMENT OF BUSINESS AND SOCIAL STUDIES
Supplementary/Special Examination - Oct- Jan, 2009
BBM121/UCU002: DEVELOPMENT STUDIES
Time: 2 Hrs
Instructions to Candidates: Answer question 1 (Compulsory) and any other TWO questions.
QUESTION 1
(a) Describe the continuous improvement approach to the management of development
strategies (6mks)
(b) Explain the rationale behind affirmative action (5mks)
(c) Discuss the main problems of development indicators (6mks)
(d) Describe the approaches to sustainable development strategies (6mks)
(e) State the key questions posed by development ethicists in the development of ethics
in development (7mks)
QUESTION 2
(a) Explain the implication of the institutional model of development on cultural
Sustainability (12mks)
(b) Describe the justification for gender mainstreaming in development policies (8mks)
QUESTION 3
(a) Describe the role that the government can play to promote research and
development (8mks)
(b) Discuss the key issues that confront cities in developing countries due the problem
of rural-urban migration (12mks)
QUESTION 4
(a) State the measures that the Kenyan government instituted under the structural
adjustment program in the 1990s (8mks)
(b) Discuss the root causes of Africa underdevelopment (12mks)
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QUESTION 5
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(a) Describe the negative impacts of industrialization (8mks)
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(b) Discuss the basic tenets dualism theories of development (12mks)
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