Development Economics: Key Concepts, Poverty Traps, and Market Efficiency

What is import substitution?

A strategy aimed at reducing dependency on foreign goods by promoting domestic production.

What is the Vicious Circle in economic development?

A cycle where poverty leads to low investment, which in turn leads to low income and perpetuates poverty.

What does HDIS stand for in economic development?

Human Development Index, a measure of a country's social and economic development.

What role do remittances play in economic development?

They provide financial support to families in home countries, contributing to poverty alleviation and economic stability.

What is Purchasing Power Parity (PPP)?

An economic theory that compares different countries' currencies through a market 'basket of goods' approach.

What is a natural monopoly?

A market structure where a single firm can supply the entire market at a lower cost than multiple firms.

What are the key aspects of developed economics?

Income growth, welfare economics, agricultural economics, economic demography, labor economics, market studies, public economics, and environmental economics.

What is a poverty trap?

A situation where individuals or groups cannot escape poverty due to systemic barriers.

How do banks contribute to poverty traps?

They are often unwilling to loan money to small farmers, limiting their ability to invest and grow.

What is the impact of poverty and malnutrition on children?

It prevents them from growing into productive adults, perpetuating the cycle of poverty.

How does access to markets differ between rich and poor individuals?

Poor individuals often have limited access to markets for their products and necessary inputs.

What factors influence job availability in economic development?

Job availability often depends on social status rather than productivity.

What is the Human Development Index (HDI)?

A composite index measuring average achievement in key dimensions of human development: health, education, and standard of living.

What are transaction costs in market economics?

The costs associated with making an economic exchange, including search and information costs, bargaining costs, and policing and enforcement costs.

What role do public goods play in economics?

They are goods that are non-excludable and non-rivalrous, meaning they can be consumed by many without diminishing availability.

What are common resources in economic terms?

Resources that are available to all but can be overused, leading to depletion.

What are externalities in economics?

Costs or benefits incurred by a third party who did not choose to incur that cost or benefit.

How did mobile phones impact fish markets in Kerala?

They provided fishermen with price information, reducing price variability and waste, and increasing profits.

What was the effect of mobile phones on grain prices in Niger?

The introduction of mobile phones reduced price variation across rural markets, benefiting consumers and farmers.

What is the significance of information in market efficiency?

Access to information can dramatically improve market performance and welfare for all participants.

What is the relationship between climate change and economic development?

Economic development must consider sustainability and the impact on natural resources and the environment.