Class -X Economics

Chapter 1: Development
Introduction:
Development refers to the progress or improvement in different aspects of life such as income, education,
health, and quality of life. It varies from person to person based on their needs and aspirations.

What is Development?
• Development means growth, improvement, or progress in various aspects of life.

• Different people have different developmental goals (e.g., a farmer wants better irrigation, a businessman
wants profit, and a worker wants higher wages).

• National development refers to the overall progress of a country in terms of economic growth, health,
education, employment, and infrastructure.

Different People, Different Goals

Development is not the same for everyone.

Example:

1. A landless laborer may want more job opportunities.

2. A rich businessman may want higher profits and better market access.

3. A girl from a village may want better education and equal opportunities.

Conflict in Goals: Sometimes, one person’s development may harm another person. (Example: A factory opening may
provide jobs but can lead to pollution).

Income and Other Goals

• Money (Income) is important, but not the only factor in development.

• Other important factors:

Good healthcare
Education
Equality and security
Pollution-free environment
Job security

• Example: A teacher may prefer a job with job security and respect over a higher-paying but insecure job.

How to Compare Different Countries or States?

1) Per Capita Income (Average Income)

• To compare countries, Per Capita Income (PCI) is used.

• Formula: Per Capita Income=Total Income of the Country/Total Population

2) World Bank Classification (2023 Data):

a. High-Income Countries: PCI above $13,205

b. Middle-Income Countries: PCI between $1,086 and $13,205

c. Low-Income Countries: PCI below $1,086

 3) India’s PCI (2023): Around $2,500 (middle-income country).

Limitations of Per Capita Income

• It does not consider inequalities (For example: A country may have high per capita income but huge
inequality).

• It does not include non-economic factors like education, health, and environment.

Money in our pockets cannot buy all the goods and services that we may need to
live well.
• Money cannot buy us a pollution-free environment.

• Money cannot buy us a disease-free life and might not be able to get protection from infectious diseases.

• Besides money, people also like to have equal treatment in society, freedom, dignity, and honor in their lives,
which money cannot buy them.

Body Mass Index (BMI):

Body mass index (BMI) is a person's weight in kilograms divided by the square of height in meters.

Public Facilities:
Public facilities are those provided by the government instead of individuals or private sources. For this reason,
they may be either highly subsidized or totally free of cost. They are important because many persons do not
have enough income to be able to avail of facilities provided by the private sector resulting in difficulties faced
like inadequate healthcare, poor nutrition, lack of education, etc. The utility of two public facilities available in
India are:

• The public distribution system (PDS) provides fair average quality food grains and other essential items to the
weaker section of the population at subsidized prices.

• Health care in government hospitals and dispensaries is provided to all at a subsidized rate. This includes
outpatient as well as hospitalization facilities.

Human Development Index (HDI):

United Nations Development Programme has used the criterion of the Human Development Index to measure the
development of countries. The human development index is a composite index of the achievements of a nation in
terms of three important variables (longevity, knowledge, and standard of living, quality of life).

HDI is calculated on the basis of:

• Per capita income: It is calculated by dividing the total national income of a country by the total population.

• Life expectancy: It is the average expected length of life of a person at the time of birth in a country.

• Gross enrolment ratio for three levels: It means the enrolment ratio for primary schools, secondary schools,
and higher education beyond the secondary level.
 Human Development Report Vs World Development Report:

World Bank's method of measuring

UNDP's method of measuring development
development

i. UNDP compares on the basis of literacy rate, gross enrolment ratio, i. World Bank compares on the basis of per
and health status of people. capita income.

ii. It divides the countries according to

ii. It gives ranks to the countries according to their level of - rich or high-income countries
development. - middle-income or developing countries
- poor or low-income countries

iii. It is a wider concept as it includes other things besides income. iii. It is a narrow concept.

Sustainable Development
• Sustainability means using resources wisely so future generations can also benefit.

• Example:

• If groundwater is overused for farming today, future generations may not have enough water.

• Cutting too many trees leads to climate change and loss of biodiversity.

• Sustainable Development Goals (SDGs) were adopted by the United Nations in 2015 with 17 goals (e.g.,
Zero Hunger, Quality Education, Clean Water, Climate Action).

Key Questions
1. What is development? What are two aspects of development?
2. State any two goals of development other than income.
3. Why do different people have different notions of development? Explain.
4. “Conflicting goals can be development goals.” Elaborate with examples.
5. Explain how the development goals and aspirations of landless rural laborers, prosperous
farmers, and poor farmers who depend only on rain are different.
6. Give examples to prove that there are other important development goals than income.
7. “Average income is an important criterion for development.” Justify.
8. “Money in your pocket may not buy all goods and services you need to live well.” Is it true or not?
Elucidate.
9. “National development of a country depends on the availability of public facilities.” How?
10. In what respects is the criterion used by the UNDP for measuring development different from the
one used by World Bank?
11. What is the main norm used by the World Bank in classifying different countries as rich and poor
countries? What are the restrictions of such norms?
12. Explain the meaning of HDI. Mention three components of measuring HDI.
13. Why is India’s Per capita income low compared to the world average? Suggest any one measure
to increase the Per capita income of India.
14. “The issue of sustainability is important for development.” Examine the statement.