IBT NI SIR

world economy

refers to the global network of economic activities, production, trade, and financial flows that connect countries.

Developed (Advanced) Economies

High income, advanced technology, strong infrastructure.

Examples: United States, Japan, Germany. CLASSIFICATION BY LEVEL OF DEVELOPMENT

Developing Economies

Moderate income, improving infrastructure, mixed industrial and agricultural base.

Examples: Philippines, India, Brazil. CLASSIFICATION BY LEVEL OF DEVELOPMENT

Least Developed Countries (LDCs)

Very low income, weak human development indicators, dependent on agriculture.

Examples: Afghanistan, Chad, Haiti. CLASSIFICATION BY LEVEL OF DEVELOPMENT

Agricultural Economies

rely mostly on farming (e.g., Ethiopia). CLASSIFICATION BY INDUSTRIALIZATION

Industrial Economies

strong manufacturing base (e.g., China, South Korea). CLASSIFICATION BY INDUSTRIALIZATION

Post-industrial Economies

dominated by services and knowledge-based

industries (e.g., U.S., UK). CLASSIFICATION BY INDUSTRIALIZATION

Emerging Markets

rapidly growing, becoming more integrated globally (e.g., India, Vietnam, Mexico). CLASSIFICATION BY GLOBAL INTEGRATION

Transition Economies

shifting from centrally planned to market-based systems

(e.g., former Soviet states like Kazakhstan). CLASSIFICATION BY GLOBAL INTEGRATION

CORRUPTION KAINIS

has long been recognized as one of the major barriers to the Philippines' full economic potential.

VIETNAM

what country is predicted to be one of the fastest‐growing economies in Asia in 2025.

TOTAL FACTOR PRODUCTIVITY

TFT

Natural Resources

Abundant resources like oil, minerals, fertile land, or forests can provide an initial source

of wealth.

Human Capital (People & Skills)

A well-educated, skilled, and healthy workforce boosts productivity and innovation.

Countries that invest in education, healthcare, and training tend to grow faster.

Strong Institutions & Good Governance

Wealthy countries usually have stable governments, efficient bureaucracies, rule of law,

and low corruption.

This ensures fair distribution of resources, protects property rights, and attracts

investment.

Innovation & Technology

Advanced economies grow by creating new technologies, industries, and knowledge

economies.

Infrastructure

Roads, ports, energy systems, and digital networks allow businesses to operate

efficiently.

Trade & Global Integration

Open economies that trade goods, services, and ideas with others tend to generate

more wealth.

Stable Macroeconomic Management

Sound fiscal and monetary policies prevent crises (like high inflation or debt defaults).

Stability builds investor and consumer confidence.

Social Stability & Inclusiveness

Wealth is sustained when growth benefits most people, reducing inequality. Social trust and inclusiveness encourage participation and long-term development.

Gross Domestic Product

GDP

Gross Domestic Product

is the value of all the goods and services

produced by a country in a single year.

Gross Domestic Product (GDP)

is the total monetary value of all final goods and

services produced within a country's borders in a given period (usually a year or a quarter). It measures the size of an economy and is one of the most widely used indicators of economic performance.

Production Approach

Income Approach

Expenditure Approach

3 Ways to Measure GDP

Income Approach

adds up all incomes earned in the economy (wages, profits, rents, interest).

Expenditure Approach

calculates GDP by adding spending on:

C = Consumption (household spending)

I = Investment (business spending on capital, housing, inventories)

G = Government spending

NX = Net Exports (Exports - Imports)

Production Approach

sums up the value of output produced by industries, minus the value of intermediate goods.

Nominal GDP

Real GDP

GDP per capita

Types of GDP

Nominal GDP

measured at current market prices (not adjusted for inflation).

Real GDP

adjusted for inflation, shows actual growth in production.

GDP per capita

GDP divided by total population, used to compare living standards.

Services Sector

Industry Sector

Agriculture, Forestry, and Fishing

Main Sectors of Philippine GDP

Services Sector (~60% of GDP)

Largest contributor to Philippine's GDP

Industry Sector (~30% of GDP)

Covers manufacturing, construction, mining, and utilities in Philippine's GDP

Agriculture, Forestry, and Fishing (~10% of GDP)

What is the Smallest contributor, but employs a significant share of the population.

Purchasing Power Parity

WHAT IS PPP?

Purchasing power parity (PPP)

is, in essence, an economic theory that adjusts

the exchange rate between countries to

ensure that a good is purchased for the

same price in the same currency.

Purchasing power parity (PPP)

is an economic theory and method of comparing the

value of currencies by looking at how much of a standard "basket of goods and services" each currency can buy.

Human Development Index HDI

is a composite measure developed by the United

Nations Development Programme (UNDP) to evaluate the overall well-being and development of countries, not just their income.

United Nations Development Programme

UNDP

Health

Education

Standard of Living

three main dimensions of human development:

Health

measured by life expectancy at birth. (it is one of the dimensions of human development)

Education

measured by average years of schooling (for adults) and expected years of schooling (for children). (it is one of the dimensions of human development)

Standard of Living

measured by Gross National Income (GNI) per capita (PPP $). (it is one of the dimensions of human development)

Closer to 1

The HDI ranges from 0 to 1.

? = higher human development (better health, education, and income).

Closer to 0

The HDI ranges from 0 to 1.

? = lower human development.

Very High Human Development:

HDI of 0.800 and above

High Human Development:

HDI OF 0.700 - 0.799

Medium Human Development:

HDI OF 0.550 - 0.699

Low Human Development:

HDI OF below 0.550

industrialized

refers to a region that has developed industries. This includes tech enterprises, manufacturing, and other industries that bolster the economic activity of the region.

Newly Industrialized Country, or NIC.

This is a term that was created by economists and political scientists to describe countries with economic development that falls between the classifications of First World and developing.

Newly Industrialized Country, or NIC.

are countries in transition between being developing and fully developed.

(Brazil, Russia, India, China, South Africa)

WHAT COUNTRIES ARE INCLUDED IN "BRICS Nations"

(Mexico, Indonesia, Nigeria, Turkey)

WHAT COUNTRIES ARE INCLUDED IN "MINT Economies"

(Bangladesh, Egypt, Iran, Pakistan, Philippines, etc.)

WHAT COUNTRIES ARE INCLUDED IN "NEXT ELEVEN"

Asia-Pacific

Home to fast-growing economies like India, Vietnam, Philippines, and Bangladesh.

Sub-Saharan Africa

Rich in natural resources, but still faces infrastructure and governance challenges.

Latin America

Economies like Brazil and Mexico dominate, with industries ranging from agriculture and

oil to manufacturing and services.

Middle East and North Africa (MENA)

WHAT REGIONS ARE countries (like Egypt and Iran) are considered developing economies with large

populations and growing industries.