The Changing Economic World

What is development?

The process of improving people's economic + social well-being and quality of life.

What is economic development?

Improvement in a country's wealth, income + economic opportunities.

What is social development?

Improvement in people's quality of life, such as health, education + access to services.

What is an HIC?

A higher income country with a relatively high GNI per head.

What is an LIC?

A lower income country with a relatively low GNI per head.

What is an NEE?

A newly emerging economy - a country experiencing rapid economic growth + industrialisation.

Why can countries be difficult to classify by development?

Development has many economic + social dimensions and can vary within a country.

What is GNI?

Gross National Income - the total income earned by a country's people + businesses, including income from abroad.

What is GNI per head?

GNI divided by the population, giving an average income per person.

Why is GNI per head useful as a development indicator?

It allows average income levels to be compared between countries.

What is a limitation of GNI per head?

It is an average + hides inequalities in income and differences in quality of life.

What is birth rate?

The number of live births per 1,000 people per year.

What is death rate?

The number of deaths per 1,000 people per year.

What is infant mortality rate?

The number of babies who die before their first birthday per 1,000 live births.

What does a high infant mortality rate usually suggest?

Poor healthcare, sanitation, nutrition or living conditions.

What is life expectancy?

The average number of years a person is expected to live.

Why is life expectancy a useful development indicator?

It reflects factors such as healthcare, nutrition, sanitation + living conditions.

What does people per doctor measure?

Access to healthcare - fewer people per doctor generally suggests better healthcare provision.

What is literacy rate?

The percentage of people who can read + write.

Why is literacy rate a development indicator?

Higher literacy generally indicates better access to education.

Why is access to safe water a development indicator?

Clean water reduces disease + reflects access to basic infrastructure.

What is the Human Development Index (HDI)?

A development measure combining life expectancy, education + income.

What range does HDI use?

0 to 1 - values closer to 1 indicate higher human development.

Why can HDI be better than using income alone?

It includes health + education as well as economic development.

What is a limitation of HDI?

It uses national averages, so it can hide inequalities within a country.

Why should several development indicators be used together?

Development is multidimensional, so one indicator cannot show the full quality of life.

What is the Demographic Transition Model (DTM)?

A model showing how birth rate, death rate + population change as a country develops.

What happens in DTM Stage 1?

Birth rate + death rate are high - population growth is very low.

What happens in DTM Stage 2?

Death rate falls rapidly while birth rate remains high - rapid population growth.

Why does death rate fall in Stage 2?

Improved healthcare, food supply, sanitation + clean water.

What happens in DTM Stage 3?

Birth rate falls - population continues growing but more slowly.

Why does birth rate fall as a country develops?

Improved education/contraception, lower infant mortality, urbanisation + changing role of women.

What happens in DTM Stage 4?

Birth rate + death rate are both low - population is high + relatively stable.

What can happen in DTM Stage 5?

Birth rate may fall below death rate - population can naturally decline.

How is the DTM linked to development?

As countries develop, death rates usually fall first followed by birth rates.

What is uneven development?

Differences in levels of development between countries or regions.

What are the three broad causes of uneven development required by AQA?

Physical, economic + historical causes.

What physical factors can cause uneven development?

Climate, natural hazards, landlocked location, poor soils, disease + limited natural resources.

How can climate limit development?

Drought/extreme climates can reduce agricultural output + make infrastructure and working conditions difficult.

How can natural hazards limit development?

They cause deaths/damage + require money to rebuild rather than invest in development.

How can being landlocked restrict development?

No direct access to seaports makes international trade more difficult + expensive.

How can disease restrict development?

Illness reduces productivity + requires spending on healthcare.

What economic factors can cause uneven development?

Poor trade links, dependence on low-value exports, debt + lack of investment.

How can dependence on primary products restrict development?

Raw materials often have low/unstable prices, limiting export income.

How can debt restrict development?

Money spent repaying debt cannot be spent on healthcare, education + infrastructure.

What historical factors can cause uneven development?

Colonialism, conflict + past trading relationships can affect current economies and institutions.

How can colonialism contribute to uneven development?

Resources and economies were often organised to benefit colonial powers, leaving long-term economic disadvantages.

What are consequences of uneven development?

Differences in wealth/health + international migration.

How does uneven development create health inequalities?

Poorer countries may have less access to healthcare, clean water, sanitation + adequate nutrition.

How does uneven development create wealth inequalities?

Income, employment opportunities + access to resources differ greatly between countries.

How can uneven development cause international migration?

People may move from poorer to wealthier countries seeking jobs, higher incomes + better quality of life.

What is the development gap?

The difference in levels of development between richer + poorer countries.

What strategies can reduce the development gap?

Investment, industrial development, tourism, aid, intermediate technology, Fairtrade, debt relief + microfinance.

How can investment reduce the development gap?

Businesses/governments invest money in industry or infrastructure - creating jobs, income + economic growth.

How can industrial development reduce the development gap?

Manufacturing creates jobs, increases exports + can increase incomes and tax revenue.

How can tourism reduce the development gap?

Tourists bring foreign currency + create jobs, business opportunities and tax revenue.

What is a possible disadvantage of tourism for development?

Profits may leave the country, jobs may be low-paid/seasonal + tourism can cause environmental damage.

What is aid?

Money, resources or expertise given to support another country's development or respond to emergencies.

What is bilateral aid?

Aid given directly from one country to another.

What is multilateral aid?

Aid provided through an international organisation.

What is short-term emergency aid?

Immediate assistance such as food, water, shelter + medical supplies following a crisis.

What is long-term development aid?

Support for projects such as schools, healthcare, water supplies + infrastructure to improve development.

How can aid reduce the development gap?

It can improve health, education, infrastructure + economic opportunities.

What are possible disadvantages of aid?

It can create dependency, be poorly targeted or come with conditions.

What is intermediate technology?

Affordable, appropriate + sustainable technology suited to local people's needs and skills.

Why can intermediate technology support development?

It is often cheap to maintain, uses local skills/materials + directly meets local needs.

What is Fairtrade?

A system designed to give producers in poorer countries fairer prices + better working conditions.

How can Fairtrade reduce the development gap?

Higher/more stable incomes allow producers to improve their standard of living + invest in communities.

What is debt relief?

Cancelling or reducing money owed by poorer countries.

How can debt relief support development?

Money previously used for repayments can be spent on healthcare, education + infrastructure.

What is microfinance?

Providing very small loans to people who cannot access conventional banking.

How can microfinance promote development?

People can start/expand small businesses - increasing income + employment.

What is an industrial structure?

The proportion of a country's economy/employment in different economic sectors.

What is the primary sector?

Extracting natural resources, such as farming, fishing, forestry + mining.

What is the secondary sector?

Manufacturing + construction - turning raw materials into products.

What is the tertiary sector?

Providing services, such as retail, transport, healthcare + tourism.

What is the quaternary sector?

Knowledge-based services such as research, IT + scientific development.

How does industrial structure usually change as a country develops?

Primary employment decreases - secondary initially grows - tertiary + quaternary sectors become increasingly important.

How can manufacturing stimulate economic development?

It creates jobs - raises incomes - increases spending/tax revenue - increases demand for other businesses + infrastructure.

What is the multiplier effect?

When initial economic growth creates further jobs, income + spending elsewhere in the economy.

What is a TNC?

A transnational corporation - a company that operates in more than one country.

Why do TNCs operate in LICs/NEEs?

Lower labour costs, new markets, raw materials + favourable government policies may reduce costs/increase profits.

What are advantages of TNCs for a host country?

Jobs, wages, investment, skills, infrastructure, exports + tax revenue.

How can TNCs create a multiplier effect?

Workers/suppliers gain income - spend it locally - increasing demand + creating further jobs.

What are disadvantages of TNCs for a host country?

Low wages/poor conditions may occur, environmental damage is possible + profits may leave the country.

Why might TNC profits not fully benefit the host country?

Profits may be returned to the company's home country.

How can economic development change a country's international relationships?

Increased trade + political importance can create stronger links with other countries.

How can international trade encourage development?

Exports generate income + businesses gain access to larger markets.

How can international aid affect a developing country?

It can improve infrastructure/services + support economic and social development, but its impact depends on how effectively it is used.

What environmental impacts can rapid economic development cause?

Air/water pollution, waste, deforestation, habitat destruction + increased greenhouse-gas emissions.

Why can industrialisation increase air pollution?

Factories, power generation + transport may burn fossil fuels and release pollutants.

How can economic development improve quality of life?

Higher incomes/tax revenues can improve housing, education, healthcare + access to services.

Why might economic growth not improve everyone's quality of life equally?

Benefits may be unevenly distributed between regions + social groups.

What is deindustrialisation?

The decline of traditional manufacturing + heavy industry.

What caused major economic change in the UK?

Deindustrialisation, globalisation + government policies.

Why has traditional UK manufacturing declined?

Automation, changing demand + competition from lower-cost overseas producers have contributed to factory closures.

What is globalisation?

The increasing interconnectedness + interdependence of countries through trade, investment, communication + movement.

How can globalisation affect the UK economy?

Businesses can operate internationally, but UK industries also face greater overseas competition.

How can government policies change the economy?

Tax, investment, infrastructure, education + business policies can encourage or discourage particular industries.

What is a post-industrial economy?

An economy where manufacturing becomes less important while services + knowledge-based industries become more important.