Development and global inequality
Development means positive change in people's lives: more income, better health, more education and more freedom.
How it is measured
- GNI per person: national income divided by population. Simple, but hides inequality inside a country.
- Human Development Index (HDI): combines health (life expectancy), education (years of schooling) and income. It ranges from 0 to 1.
- Other measures: poverty headcount, the Gini coefficient (inequality), the Gender Inequality Index and the Multidimensional Poverty Index.
Terms such as 'developing', 'less economically developed' and 'Global South' are used; all are simplifications.
Theories of development
- Modernisation theory: poor countries are held back by traditional values. With Western-style investment, education and industry they will pass through Rostow's five stages: traditional society → preconditions for take-off → take-off → drive to maturity → high mass consumption. Criticism: ethnocentric, ignores colonial history.
- Dependency theory (Frank): rich core nations exploit poor periphery nations through colonialism, unfair trade and debt, causing underdevelopment.
- World systems theory (Wallerstein): one global capitalist system with core, semi-periphery and periphery; countries can move between them.
- Neoliberalism: free markets, privatisation and less state control bring growth. Linked to IMF/World Bank structural adjustment.
- People-centred / post-development: local, bottom-up projects and local knowledge matter more than outside plans.
Globalisation, TNCs, NGOs and international agencies
Globalisation is the growing connection of the world through trade, money, media, travel and ideas.
- Transnational corporations (TNCs) work in many countries. For: jobs, investment, skills, taxes. Against: low wages, poor working conditions, profits sent home, pollution, power over governments.
- Non-governmental organisations (NGOs) are charities and groups not run by governments. For: local, flexible, reach the poorest. Against: small scale, may depend on donors, may not be accountable.
- International agencies: the World Bank (loans for projects), the IMF (loans in crises, with conditions), the UN (Sustainable Development Goals), the WTO (trade rules).
Aid, trade, debt and urbanisation
Aid
Types: bilateral (one country to another), multilateral (through agencies), tied aid (must be spent buying the donor's goods), emergency aid and loans. Modernisation and neoliberal thinkers argue about whether aid helps or creates dependency; Marxists see it as a tool of power.
Trade and debt
Many poorer countries export cheap primary products and import expensive manufactured goods. Fair trade tries to pay producers more. Debt repayments can be larger than aid received, so money flows out.
Urbanisation
People move from villages to cities for work. Cities bring jobs and services, but fast growth creates informal settlements, crowding and the informal economy.
Environment and conflict
- Environment: industrial growth can cause pollution, deforestation and climate change, which hit poor people hardest. Sustainable development means meeting today's needs without harming future generations.
- War and conflict: wars destroy schools, hospitals and trade, push people to become refugees and reverse years of development. Causes can include competition for resources, weak states and inequality. Rebuilding needs peace, safety and trust.
Education, health and gender in development
- Education builds skills (human capital) and helps people take part in society. Barriers: cost, child labour, distance, poor quality.
- Health: healthy people can work and learn. Problems include infectious disease, poor sanitation and lack of clinics. Life expectancy is a key measure.
- Gender: women do much unpaid work and often have less land, pay and power. Educating girls is linked to fewer child deaths, later marriage, smaller families and higher income. Micro-finance and quotas aim to empower women.
These three are linked: improve one and the others often improve.
Key formulas and definitions
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Worked examples
1. A country has life expectancy 72 years. Find its health index.
Health index = (72 − 20) ÷ (85 − 20) = 52 ÷ 65 = 0.80.
2. Adults have on average 9 years of schooling; children are expected to get 12 years. Find the education index.
Mean part = 9 ÷ 15 = 0.600. Expected part = 12 ÷ 18 = 0.667. Education index = (0.600 + 0.667) ÷ 2 = 0.633.
3. With health index 0.80, education index 0.633 and income index 0.696 (income $10 000), find the HDI.
Multiply: 0.80 × 0.633 × 0.696 = 0.352. Cube root: ∛0.352 ≈ 0.706. HDI ≈ 0.71, which is 'high' human development.
4. A country receives $2 billion in aid but pays $3 billion in debt repayments and loses $1 billion in TNC profits sent abroad. What is the net flow, and what would dependency theory say?
Net flow = 2 − 3 − 1 = −$2 billion: money leaves the country. Dependency theory would say this shows how the core drains wealth from the periphery, keeping it underdeveloped.
Common mistakes
- Using GNI alone to judge development. It ignores health, education and inequality.
- Thinking all aid is a gift. Much is loans or tied aid that must be spent on the donor's goods.
- Saying TNCs are only good or only bad. Sociologists weigh jobs and investment against low wages, pollution and power.
- Taking the arithmetic average for HDI. It uses the geometric mean (cube root of the product).