Chapter 18/19: Economic Dev + Barriers to Growth and Development

Sustainable development

Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

SDGs

Monitor and measure progress achieved in each country.

Economic development

The process where increases in real per capita output and incomes are accompanied by

• improvements in standards of living of the population

• reduction in poverty

• increase in access to goods and services to satisfy basic needs

• improved gender equality

• increase in employment

• reductions in wealth gap

Indicator

A measurable variable that indicates the state or level of something being measured.

Composite indicators

Summary measures of more than one dimension of development.

Human development index (HDI)

Measures average achievement in 3 dimensions:

• long and healthy life: measured by life expectancy

• access to knowledge: mean and expected years of schooling

• standard of living: GNI per capita

Inequality adjusted HDI

Measures each dimension adjusted for inequality.

Gender inequality index (GII)

Measures inequalities between the genders in 3 dimensions:

• reproductive health: maternal mortality ratio & adolescent birth rates

• empowerment: share of parliamentary seats held by women; proportion of women with at least some secondary education

• labour market participation: women in the workforce

Poverty Trap

Low incomes → low savings → low investments in physical, human and natural capital (resources from nature like land/access to water) → low productivity of labour and of land → low growth in income.

Transmitted from generation to generation.

Infrastructure

The large scale physical capital needed for economic activity to take place.

Appropriate technology

The choice and use of technology that is small scale, energy efficient, environmentally friendly and affordable.

Human Capital

Skills, knowledge and experience of people that is valuable to families, communities and organisations.

Primary Sector

Sector that produces primary commodities, which are goods arising from the factor of production land.

Tariff Escalation

When importing countries impose higher tariffs on finished goods rather than raw materials (makes it difficult for countries in primary sector to move to producing manufactured products).

Informal Economy

Economic activities that are unrecorded and unregulated.

Capital Flight

Large-scale transfers of privately-owned financial capital (funds) to another country. Results from high uncertainty and risk in holding domestic assets, which occurs due to negative economic, political or social conditions.

Indebtedness

Is when a an individual, firm or government has borrowed money and now owes money to another party.

Endemic diseases

A disease that remains at a baseline level in a population. G

Governance

The decision making and implementing processes within an organisation or institution.

Political systems

A set of legal institutions that define how the government is structured and how it functions.

Corruption

The abuse of power for private gain.

Tax structure

The mix of taxes it uses to raise revenues, the rates of tax applied, methods of government enforcement and levels of tax payment compliance.