Development Economics Vocabulary

Flashcards on Development Economics

Extreme Poverty

Characterized by open fire cooking, food insecurity, inadequate clothing, limited education, self-constructed housing, unsanitary water sources, and open defecation.

Second-Lowest Stratum

Features basic cooking energy, potential food insecurity, inexpensive clothing, primary school completion, partly self-constructed housing, basic furnishings, and water from a tap requiring self-treatment.

Second-Highest Stratum

Includes manufactured burners for cooking, usually food security, inexpensive new clothing, primary school completion and some secondary, modest housing, and purchased furnishings with electricity.

Highest Stratum

Characterized by modern cooking appliances, a rich and diverse diet, well-fitting clothing, complete high school education, modern professionally constructed housing, and safe water at taps throughout the house.

Gross National Income (GNI)

A measure of a country's income, including income from domestic production and international sources claimed by residents.

Low Income Country (LIC)

A country classified by the World Bank within a specific range of average national income.

Upper Middle Income Countries (UMCs)

Countries classified within a specific range of average national income, above lower-middle income but below high-income.

Lower Middle Income Counties (LMCs)

Countries classified within a specific range of average national income, above low-income but below upper-middle income.

Human Development Index (HDI)

A measure used by the United Nations Development Programme (UNDP) to classify countries, taking into account health, education, and income.

Development Economics

An empirical research discipline that incorporates research in political economy, institutional behavior, and experimental economics, addressing improvements in levels of living.

Amartya Sen’s Capability Approach

Argues that poverty is not properly measured by income or utility, but by what a person is or can be and does or can do. Focuses on functionings and capabilities.

Functionings

What a person does (or can do) with the commodities they possess or control; valued beings or doings.

Capabilities

The freedom that a person has in terms of the choice of functionings, given personal features and command over commodities.

Basic Well-Being

Defined as being healthy, well-nourished, well-clothed, literate, and long-lived.

Broader Freedoms

Includes participating in community life, mobility, personal security, and genuine freedom of choice in actions and life goals.

Dudley Seers

Argued that development should be measured by reductions in poverty, unemployment, and inequality.

Denis Goulet

Stated that development’s legitimacy rests on its capacity to enhance human esteem and dignity.

W. Arthur Lewis

Believed the true benefit of economic growth lies in enlarging the range of human choices, warning against 'fetishizing' income.

Social Capital

Hope that societies can gain the benefits of development without losing traditional strengths such as moral values and trust in others.

Sustainable Development Goals (SDGs)

17 goals adopted by the United Nations in 2015 to be achieved by 2030, addressing various global challenges.

Millennium Development Goals (MDGs)

Eight goals adopted in 2000, committing countries to making progress toward eradicating poverty and achieving human development goals by 2015.

Absolute Poverty

Living with incomes of less than $2 per day, characterized by poor housing, irregular school attendance, inadequate food, and lack of basic amenities.

Subsistence Economy

An economy where there is little money, so people make their own food, shelter, and most of the goods they need.

Development

The process of improving the quality of all human lives and capabilities by raising people’s levels of living, self-esteem, and freedom.

Traditional Economics

Focuses on the efficient allocation and growth of scarce resources to produce goods and services, emphasizing utility, profit, and market efficiency.

Political Economy

Expands on traditional economics by examining how power and politics influence economic decisions.

Social System

The organizational and institutional structures of society, such as cultural values, power dynamics, and traditions.

Traditional Economic Measures of Development

Sustained growth in real per capita income, measured using real per capita GNI (Gross National Income).

New Economic View of Development

Includes reducing poverty and inequality, creating employment, and enhancing the quality of life alongside economic growth.

Three Core Values of Development

Sustenance, self-esteem, and freedom.