Comprehensive Study Notes on Module 3 Unit 1: Development and Sustainable Goals

Sustainable Development Goals (SDGs)

• The Sustainable Development Goals are a set of $17$ global objectives established to ensure a better and more sustainable future for all.
• Goal $1$: No Poverty.
• Goal $2$: Zero Hunger.
• Goal $3$: Good Health and Well-being.
• Goal $4$: Quality Education.
• Goal $5$: Gender Equality.
• Goal $6$: Clean Water and Sanitation.
• Goal $7$: Affordable and Clean Energy.
• Goal $8$: Decent Work and Economic Growth.
• Goal $9$: Industry, Innovation, and Infrastructure.
• Goal $10$: Reduced Inequalities.
• Goal $11$: Sustainable Cities and Communities.
• Goal $12$: Responsible Consumption and Production.
• Goal $13$: Climate Action.
• Goal $14$: Life Below Water.
• Goal $15$: Life on Land.
• Goal $16$: Peace, Justice, and Strong Institutions.
• Goal $17$: Partnerships for the Goals.

Defining Development

• Development is the process of becoming better, stronger, and more advanced.
• Standard of Living: Indicators such as population growth rate or the number of TV sets per $1000$ people inform us about the standard of living in a country.
• Levels of Development: Information regarding indicators is used to calculate whether a country is developed or developing.
  • Developed Countries: Nations that have achieved a high level of development (also referred to as "First World" countries).
  • Developing Countries: Nations with a low level of development (also referred to as "Third World" countries).

Three Main Aspects of Development

Economic Aspect

• Focuses on the wealth of individuals and the country as a whole.
• Per Capita Income: This is a primary indicator, defined as the average amount of money a person earns per year.
• Income Sources and Economic Activities:
  • Primary Activities: Poor and less developed countries typically earn income from raw resource extraction, including farming, mining, fishing, and forestry.
  • Secondary Activities: Developed and wealthier countries earn income by manufacturing goods.
  • Tertiary Activities: Developed countries also rely heavily on providing services.

Social Aspect

• Focuses on the quality of human life and access to essential services.
• Key indicators include:
  • Quality of life.
  • Access to social services (good education systems and infrastructure).
  • Access to basic needs (e.g., clean water).
• Political and Human Rights: Developed countries usually feature strong democracies where people enjoy political and personal freedom, alongside the right to equality regardless of gender, race, culture, or religion.

Environmental Aspect

• Focuses on how a country utilizes its natural resources.
• Sustainability: The core environmental aspect is the sustainability of development level.
• Environmentally Sustainable Development: This process causes as little long-term damage to the environment as possible to ensure enough resources remain for future generations.
• Case Study – Over-fishing:
  • A fishing community earns income for schools, infrastructure, and jobs.
  • If they catch fish faster than the fish can reproduce (depleting stocks), the practice becomes unsustainable.
  • Consequences of over-fishing include future generations earning less, job losses, and business closures.

Measuring Development via Indicators

• Development is measured using a variety of specific economic, social, and environmental indicators.

Economic Indicator: Gross Domestic Product (GDP) per Capita

• Definition: The total value of all goods and services produced in a country during one year, divided by the total number of people in the country.
• Global Trends: While GDP per capita is increasing in most countries, it is stagnant or declining in the poorest nations.
• Factors hindering GDP per capita improvement:
  • Wars.
  • Rapid population growth.
  • Repayment of large debts.
  • Lack of resources for development.
  • Natural and human-made disasters (specifically including the impact of Aids).

Social Indicators

• Population growth rate.
• Birth rate and Death rate.
• Adult literacy rate.
• Measurements regarding access to education, health, and nutrition.

Limitations and Bias in Indicators

• Using a single indicator can result in a biased or misleading picture of development.
• Example – Doctors per $1000$ people: Generally, a higher ratio suggests higher development. However, Cuba has more doctors per $1000$ people than many wealthier, more developed countries because the state pays for university fees, encouraging students to enter the long and expensive medical field despite the country's overall lower development level.

The Human Development Index (HDI)

• The HDI provides a more balanced and accurate picture of development by combining several indicators to measure well-being.
• Scoring: HDI is a decimal value between $0$ and $1$.
  • An HDI of $0$ represents the worst possible quality of life.
  • An HDI of $1$ represents the best possible quality of life.
• Examples of HDI Scores:
  • Switzerland: $0.93$ (more developed).
  • Botswana: $0.55$.
• The Three Core Indicators of HDI:
  1. Life Expectancy (LE).
  2. Level of Education.
  3. GDP per capita.

Deep Dive into HDI Components

Life Expectancy (LE)

• Definition: The average lifespan from birth to death for a person in a specific country.
• Trends: Women typically have a slightly longer life expectancy than men.
• Influence: LE is a premier social indicator because it reflects the standard of health services and nutrition levels.
• Historical Changes: Over the last $50$ years, LE in developed countries increased by more than $50\%$ due to medical advancements. In some Southern African countries, LE has dropped due to diseases like malaria and Aids.

Level of Education

• Education acts as a catalyst for wealth creation. High-quality education systems produce qualified professionals who use their skills to increase a country's development.
• Successful Examples: Japan, South Korea, and China have seen rapid rises in HDI due to focused improvements in education.
• Stagnation: Many African countries struggle with low education levels, which hinders their development scores.

Per Capita GDP Statistics

• Currency: Usually expressed in US dollars (US\).
• Categories:
  • High: Over $US\$20000$.
  • Medium: Between $US\$3000$ and $US\$20000$.
  • Low: Below $US\$3000$.
• Global Distribution:
  • $15\%$ of the world population has a high GDP per capita (North America, Europe, Japan, Australia).
  • The USA has a GDP per capita of approximately $US\$37000$.
  • $30\%$ of the world population has a medium GDP per capita.
  • More than $55\%$ of the world population has a low GDP per capita (includes all of Africa and much of South America and Southern Asia).
  • Extreme Poverty: In countries like Mozambique, the GDP per capita is less than $US\$500$ per year, which equates to roughly $US\$1$ per day.

Nuances in Development Statistics

• Incomes vs. Development: High income does not always guarantee high development.
• Income Gaps: In South Africa (SA), a huge gap exists between the rich and the poor. A small group of wealthy earners inflates the national GDP per capita, while the actual income and HDI for the majority of the population remain low.
• Cost of Living: GDP can be misleading because the purchasing power or cost of living varies significantly between countries.
• Comparative Examples:
  • USA: GDP per capita of roughly $US\$37000$ and an HDI of $0.91$.
  • Luxembourg: GDP per capita of roughly $US\$55000$ and an HDI of $0.87$.
  • Both maintain very high levels of development despite different economic outputs.

Regional Development and the "Asian Tigers"

• Analyzing regional differences helps leaders formulate policies to accelerate development.
• Asian Tigers: A group of Eastern Asian countries, including China, Vietnam, and South Korea, that have developed rapidly over the last $20$ years.
• The Asian Model: These countries focused heavily on infrastructure, education levels, and trade links. This model is now studied by other economists looking to boost growth.
• UN Human Development Report ($2011$): This report ranked $187$ countries. It showed a clear regional divide: top-ranked countries were largely from Western Europe, while the lowest-ranked countries were primarily from sub-Saharan Africa.