(7) Cluster 1: Economic Development, Metrics & Theories

Cluster 1: Economic Development, Metrics & Theories

Absolute Advantage

The ability of a country, firm, or individual to produce more of a good or service than competitors using the same number of resources.

Comparative advantage

Ability of a country to produce goods or services at a lower opportunity cost than its trading partners.

Competitive Advantage

The attributes that allow an organization or a country to outperform its competitors, often resulting from unique resources, capabilities, or positioning in the market.

Complementarity

The relationship between regions where each provides goods, services, or resources that the other needs, fostering trade and economic interaction.

GDP per capita

Measures a country's total economic output (GDP) divided by its total population, representing the average economic production or income per person.

Gross Domestic Product (GDP)

The total dollar value of all final goods and services produced within a country's borders in a specific time period.

Gross National Income (GNI)

The total domestic and foreign income earned by a country's residents and businesses in a year, including money sent home by citizens working abroad and profits from foreign investments.

Gross National Product (GNP)

The total value of all final goods and services produced by a country's residents.

Human Development Index (HDI)

Composite index introduced by the UNDP to measure national progress beyond economic growth alone.

Gender Empowerment Index

UN-developed index measuring women's participation in political and economic life, focusing on agency rather than just welfare.

Gender inequality index

Composite measure that reflects gender disparities in three critical dimensions

Gender Parity

Equal representation or status between both men and women.

Income Distribution

Refers to how a nation's total earnings are divided among its population, indicating how wealth is allocated across different social groups.

Purchasing power parity

An economic theory that states that in the long run, exchange rates should adjust so that identical goods have the same price in different countries when expressed in a common currency.

Multiplier effects

The process by which an initial economic activity generates additional economic benefits, creating a chain reaction of jobs, income, and services in a region.

Growth Pole

A concentrated, specific location where high-tech industries or economic sectors cluster together driving rapid economic growth and development in that region and the surrounding areas.

Dependency theory

Poor (peripheral) countries stay underdeveloped because rich (core) countries exploit them for raw materials and labor, creating a cycle of dependency.

World systems theory

Theory categorizing countries into core, semi-periphery, and periphery based on their roles in the global economy.

Semi periphery

Countries occupying an intermediate position between core and peripheral nations.

Neoliberalism

An economic and political ideology that promotes free markets, deregulation, privatization, and minimal government intervention in the economy, shaping global trade, urban development, and social dynamics.

Mercantilism

Theory prioritizing state power through large wealth, specifically hording gold and silver.

Import Substitution Industrialization (ISI)

An economic policy where developing countries replace foreign imports with domestically produced goods to promote local industrial growth.