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• Define and explain key economic and development concepts

• Differentiate between traditional and new economic views of development
• Identify and explain basic indicators of economic development.
• Understand the concept of holistic measures of living levels and
capabilities.
• Describe the characteristics of the developing world.
• Trace the evolution of economic development from its early stages to the
present. •
• Explain the importance of the United Nations' 17 Sustainable Development
Goals (SDGs).

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Difference between economic growth and economic development
Economic Growth Economic Development
• Focus: Quantitative increase in the • Focus: Broad improvement in the overall well-being
production of goods and services and quality of life of a country's population.
within a country.
• Measurement: Measured by a broader range of
• Measurement: Primarily measured indicators, including:
by Gross Domestic Product (GDP)
o Human Development Index (HDI)
per capita. o Life expectancy
o Education levels
o Poverty rates
• Scope: Narrower in scope, o Environmental sustainability
primarily focused on economic o Social equity
factors like production, • Scope: Broader in scope, encompassing social,
consumption, and investment. political, and environmental factors alongside
economic ones.

• Nature: Can occur without • Nature: Requires advancements in human well-

significant improvements in living being beyond just economic output.
standards.
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CHAPTER 1 Introducing Economic Development: A Global Perspective

1.1 Introduction to Some of the World’s Biggest Questions

Development : The process of improving the quality of

all human lives and capabilities by raising people’s levels
of living, self-esteem, and freedom

1.2 How Living Levels Differ Around the World

Living standards strata : Stylized sets of material living conditions;

the 4-strata schema was created by Hans Rosling

Subsistence economy - An economy in which production is mainly for personal

consumption and the standard of living yields little more than basic necessities of
life—food, shelter, and clothing (communities primarily engage in farming, growing crops,
and raising animals for their own consumption. Examples include small family farms in rural
areas around the world.)
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Social classes in the Philippines / Social Stratification
The Middle Class:
Upper Class (Elite or Upper-Middle Class) •A diverse group with varying levels of income
•Comprises the wealthiest segment of society. and lifestyle. referred to as the "working class"
•Includes prominent families, top business executives, or "professional class."
influential politicians, and celebrities. •Generally includes professionals (doctors,
•Often possess significant economic and political power. lawyers, engineers), small business owners, and
•significant access to quality education, healthcare, skilled workers.
and international travel •Can be further subdivided into upper-middle,
•enjoy substantial incomes from business ventures, middle-middle, and lower-middle classes
investments, and inheritances. They may live in
exclusive neighborhoods and have access to the best The Underclass Informal Sector (Informally
services and amenities. Employed):
•Refers to the most disadvantaged segment of
society.
The Lower Class: ((Poverty-Stricken or
•Often includes homeless individuals, street children,
Marginalized)
and those living in extreme poverty
•Includes a significant portion of the population.
•Often characterized by low incomes, limited access Conclusion:
to education and healthcare, and precarious The social stratification in the Philippines is a complex system
employment. characterized by significant inequalities between different classes.
While some groups have access to substantial wealth, education, and
•May include subsistence farmers, daily wage opportunities, others struggle with poverty and limited access to
earners, and those living in poverty. resources. Addressing these disparities requires comprehensive efforts
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to improve education, healthcare, infrastructure, and social safety
nets to reduce inequality and provide opportunities for upward social
mobility.
 1.3 How Countries Are Classified by Their Average Levels of Development: A First
Look

Gross national income (GNI) The total domestic

and foreign output claimed by residents of a
country, consisting of gross domestic product (GDP)
plus factor incomes earned by foreign residents,
The World Bank classifies countries into four
minus income earned in the domestic economy by
income groups based on their Gross National
nonresidents.
Income (GNI) per capita:
Low-Income Country (LIC) In the World Bank
Low-income countries (LICs): GNI per capita of
classification, countries with a GNI per capita of
$1,085 or less in 2021.
less than $996 in 2018.
Upper-middle-income countries (UMICs): GNI per
Upper-middle income countries (UMCs) In the
capita between $4,466 and $15,500 in 2021.
World Bank classification, countries with a GNI per
capita between $3,896 and $12,055 in 2018.
Lower-middle-income countries (LMICs): GNI
per capita between $1,086 and $4,465 in 2021.
Lower-middle income countries (LMCs) In the
World Bank classification, countries with a GNI per
High-income countries (HICs): GNI per capita of
capita incomes between $996 and $3,895 in 2018.
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1.4 Economics and Development Studies
Development economics The study of how economies are transformed from stagnation to growth and from
low- income to high-income status, and overcome problems of extreme poverty
Geographic scope - generally considered to be most of Asia, sub-Saharan Africa, the Middle East and North
Africa, Latin America and the Caribbean, and often the formerly Communist transition economies of East and
Southeast Europe (why these countries or region because of historical colonialism and exploitation, political
instability, environmental challenges, etc…

Dynamic field - refers to an area of economic activity that is constantly evolving and
changing (*characterized by ra[id grpwth and innovation, high levels of
uncertainty. Creative destruction, etc…
Institutions Constitutions, laws, regulations, social norms, Implications for Economic Development:
rules of conduct, and generally accepted ways of doing things. • Innovation and productivity
• Job creation
Economic institutions are “humanly devised” constraints that • Addressing global changes
shape human interactions, including both informal and formal • Skill mismatch
“rules of the game” of economic life in the widely used • Inequality
framework of Douglass North. • Regulations

Social system The organisational and institutional structure of

a society, including
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traditions.
1.5 The Meaning of Development: Amartya Sen’s “Capability” Approach
Functionings (Paggawa)
What people do or can do with the commodities of given characteristics that they come to possess or control.

Definition: These are the actual achievements or "beings and doings" of an individual. They represent the
various ways a person can live.

Examples: Being well-nourished, being literate, being able to participate in social activities, being healthy.

Focus: Functionings emphasize the actual outcomes and experiences of individuals.

Capabilities (Kakayanan)
The freedoms that people have, given their personal features and their command over commodities.

Definition: These refer to the set of opportunities or freedoms that an individual has to achieve
different combinations of functionings. It's about the potential to live a certain way, not necessarily the
actual living of it.

Examples: The ability to be well-nourished (having access to food), the ability to be literate (having
access to education), the freedom to participate in social activities (having the time and resources).
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Focus: Capabilities emphasize the freedom and choices individuals have to live the lives they value.
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1.6 Happiness and Development

Happiness and economic development are intertwined and mutually reinforcing.

While economic growth can contribute to happiness, a focus on well-being can also
drive economic growth and create a more sustainable and equitable society.

1.7 The Sustainable Development Goals: A Shared Development Mission

Sustainable Development Goals (SDGs) Successor to the earlier Millennium

Development Goals (MDGs), a set of 17 broad goals, among them to:
end poverty and hunger; ensure healthy lives, quality education,
gender equality, water and sanitation, and modern energy;
promote inclusive growth, employment, resilient infrastructure, industrialisation,
innovation, and improved cities;
reduce inequality; combat climate change and environmental damage; and
promote peace, justice, and global partnership.

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In September 2015, the member countries of the United Nations adopted 17
Sustainable Development Goals (SDGs), to be achieved by 2030, thereby
committing to substantial achievements in ending multidimensional poverty and
improv ing the quality of life.

Sector A subset (part) of an economy, with four usages in economic development:

technology (modern and traditional sectors); activity (industry or product
sectors); trade (export sector); and sphere (private, public, and nonprofit or
citizen sectors)

Millennium Development Goals (MDGs) Precursor to the SDGs adopted by

the United Nations in 2000 to: eradicate extreme poverty and hunger;
achieve universal primary education; promote gender equality and
empower women; reduce child mortal ity; improve maternal health;
combat diseases; ensure environmental sustainability; and develop a global
devel opment partnership. Goals were assigned targets to be achieved by
2015.

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The Sustainable Development Goals are the blueprint to achieve a better and more sustainable
future for all.

They address the global challenges we face, including those related to poverty, inequality,
climate change, environmental degradation, peace and justice.

The 17 Goals are all interconnected, and in order to leave no one behind, it is important that we
achieve them all by 2030.

/Ms My 2ndSem SY 24-25 https://www.un.org/sustainabledevelopment/sustainable-development-goals/

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 Reflection Paper 1
Deadline : first regular class after the Prelims (Feb 12 (MWF) Feb 13 (TTh) :
➢ Compare and contrast the economic systems of two different countries.
➢ Evaluate the effectiveness of government policies aimed at promoting
economic growth in a particular region.
➢ Discuss the ethical implications of economic development.
➢ Write a persuasive essay on the importance of sustainable development.

Each question must be deligated/assigned individually or at least 2 members to

ensure that all have contributed in this reflection journal.

Submit via email using the following format: MWF-BSA 1A- MWF –Group 1
Do not forget to write names before each assigned question.

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Assignment and Part of Preliminary Exams ( Week 3 – Jan 27 to jan 31)

Write definitions in your notebooks or you may copy paste from your readings (for easy reference)

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