What is development and how do we measure it?
Development means a country and its people getting better off. It is not only money. It also means health, education, freedom and a clean environment.
Common indicators
- GNI per head: the total income of a country รท its population (often in US$ PPP).
- Birth rate, death rate, infant mortality: babies dying before age 1, per 1000 births.
- Life expectancy and literacy rate.
- Human Development Index (HDI): one score from 0 to 1 that mixes life expectancy, years of schooling and income.
One indicator alone can mislead: an average income hides rich and poor people in the same country. So we use several together.
Groups of countries
HICs (high-income countries), NEEs (newly emerging economies, growing fast through industry and trade, e.g. India, Brazil, Nigeria, Vietnam) and LICs (low-income countries). The difference between them is the development gap.
Theories of development
Rostow's model of growth (1960)
Walt Rostow said all countries pass through five stages:
- Traditional society: mostly farming for food, little technology.
- Preconditions for take-off: roads, mining and exports of raw materials begin.
- Take-off: factories grow fast, people move to cities.
- Drive to maturity: new industries and technology spread.
- High mass consumption: services lead, people buy many goods.
Criticism: it is based on Western countries, ignores colonial history and assumes every country follows one path.
Dependency theory (Frank, 1960s)
Andre Gunder Frank argued the world has a rich core and a poor periphery. The periphery sells cheap raw materials and buys expensive manufactured goods, so money flows to the core. Poor countries are poor because of this link, not because they are "behind".
World systems theory
Immanuel Wallerstein added a semi-periphery in the middle: countries such as NEEs that can move up (or down) the system.
Trade and the world economy
Countries trade because each can make some things better or cheaper. But the terms are not always fair.
- Primary products (cocoa, copper, cotton) have low and unsteady prices. Manufactured goods and services earn more.
- Trade blocs (groups of countries that cut taxes on trade between them) help members but can shut others out.
- Fair trade pays farmers a fair minimum price plus extra money for community projects.
- Globalisation: faster transport, containers and the internet have joined economies together.
Changes the world economy brings
Factories move to places with lower costs (global shift). Older industrial regions may lose jobs (deindustrialisation) and turn to services and high-tech work (a post-industrial economy). Emerging economies gain jobs but can face pollution, crowded cities and low wages.
Rapid growth in an NEE: what drives it?
Many NEEs, such as India, Nigeria and Vietnam, have grown fast. A case study usually looks at:
- Location and importance: population size, resources, ports, its role in its region.
- Changing industrial structure: fewer people in farming (primary), more in factories (secondary) and services (tertiary). Manufacturing helps because one factory creates jobs in suppliers too (the multiplier effect).
- TNCs: bring investment, jobs, skills and taxes, but profits may leave the country and working conditions can be poor.
- Changing trade and politics: new trade partners and stable government attract investors.
- Aid: short-term emergency aid and long-term development aid; it can help, but may come with conditions.
- Effects: higher incomes and more people in middle-class jobs, but also air and water pollution, slums and a gap between rich and poor regions.
Women and economic development
Women do a large share of the world's work, much of it unpaid (farming, carrying water, caring for children). When women get education, health care and fair pay, the whole country gains:
- Girls who finish school marry later and have fewer, healthier children.
- Women spend more of their income on food, schooling and health for the family.
- Microcredit (very small loans) and self-help groups help women start small businesses.
- More women in paid work adds to GDP and to tax income.
Barriers remain: lower pay for the same work, less land ownership and less time because of unpaid care.
Sustainable development
Sustainable development meets the needs of people today without spoiling the chances of people in the future. It balances three things: the economy, society and the environment.
Examples: solar power instead of coal, small intermediate technology projects that local people can build and repair, eco-tourism, and fair trade. The United Nations' Sustainable Development Goals set 17 targets, from ending poverty to climate action.
Try it: rank three countries
Look up (in an atlas or an online data site) GNI per head, life expectancy and literacy for three countries you choose. Rank them on each indicator. Do the rankings always agree? Then in the 3D, pick each Rostow step and decide which step each country is on. Do you agree with Rostow, or does dependency theory explain them better?
Key formulas and definitions
- GNI per head = total national income รท population
- Infant mortality = babies who die before age 1 per 1000 live births
- HDI (0 to 1) combines health (life expectancy), education (years of schooling) and income (GNI per head)
- Rostow: traditional โ preconditions โ take-off โ drive to maturity โ high mass consumption
- Dependency: core (rich, manufactured goods) โ periphery (poor, raw materials); semi-periphery in between
- Multiplier effect: new factory โ jobs โ wages spent locally โ more jobs and taxes
Worked examples
1. Country X has GNI of 300 billion US$ and 60 million people. Find GNI per head.
300 000 000 000 รท 60 000 000 = 5000 US$ per head.
2. Which Rostow stage fits a country where 70% of workers farm for food and there are few roads?
Stage 1, traditional society.
3. A country exports coffee beans for 2 US$/kg and imports packed coffee at 20 US$/kg. Which theory explains this pattern?
Dependency theory: the periphery sells cheap raw materials and buys back costly processed goods, so most value goes to the core.
4. Give one advantage and one disadvantage of a TNC car factory in an NEE.
Advantage: thousands of jobs and new skills, plus suppliers grow (multiplier). Disadvantage: profits may go abroad and the TNC may leave if costs rise elsewhere.
5. Why does educating girls reduce infant mortality?
Educated mothers know more about hygiene, nutrition and vaccines, marry later and have fewer children, so each child gets more care.
Common mistakes
- Using only GNI per head to judge development. Use several indicators, such as HDI, life expectancy and literacy.
- Saying Rostow's model fits every country. It is based on Western history and ignores colonialism and unfair trade.
- Thinking TNCs are only good or only bad. Always give both sides: jobs and investment vs profits leaving and poor conditions.
- Confusing NEE with HIC. An NEE is still developing fast; many people may still be poor.