Mini Presentations: Economic & Social & Composite Indicators of Development

Mini Presentations: Economic & Social Indicators of development Objective: Collaborate in groups to give a presentation on the assigned topic, use the slides provided – all group members must participate - 5-7 mins total, 30 mins to prepare Structure of Presentation Present and explain the definitions of your assigned section Show the class the map associated with your indicator and explain the general trend observed and any anomalies present Evaluate the indicators and explain to the class End your presentation with 5 questions for the audience to make sure they have understood the topic you presented on

Groups…. GDP per capita GNP per capita PPP adjustment & Social Indicators (people per doctor/life ex) Social Indicators (Infant mortality, Literacy, birth rate) HDI Four per group

How is development measured? Development is a complex process and there is little agreement on how to measure it The most common and easiest measures are Economic measures: Gross Domestic Product and Gross National Product (economic indicators) GDP & GNP

GDP Economic indicators GDP is definitely the preferred measure of development among economists and is gaining popularity in general conversation as well. GDP stands for Gross Domestic Product

Definition of GDP GDP measures the value of all production within a nation, by whoever happens to be working there This is usually presented as a per capita value (GDP divided by the population) Economic indicators

Choropleth map showing world distribution of GDP per capita…

How do some countries fair on a GDP per capita (PPP) list? Qatar: $87 600 Luxembourg: $79 400 USA : $45 800 U.K.: $35 500 Japan: $33 500 France: $32 600 South Korea $25 000 Botswana: $14 300 China: $ 5 400 Philippines: $ 3 200 India: $ 2 600 Kenya: $ 1 700 Bangladesh: $ 1 400 Burkina Faso: $ 1 200 Zimbabwe: $ 200 2005 data

Evaluation of GDP per capita What are the strengths and limitations of this indicator? Strengths Limitations Has an economic focus Easy to compare between countries Data is collected regularly and widely GDP is only an average Doesn’t take into account Social factors Environmental factors

Definition of GNP Gross National Product Economic indicators Gross National Product GNP measures the value of production of all a nations citizens, wherever they happen to be working. (both inside and outside the country: Maybe you can remember the "N" in GNP stands for "anywhere"). This is divided by the population to produce a per capita value (GNP per capita)

Choropleth map showing world distribution of GDP per capita…

GNP figures: Economic indicators Regional distribution of GNP: Western Europe, North America, Japan and Australia have high GNP per capita; approx 15% of world’s population 56% of the world’s population live in areas with low GNP per capita, lowest: Rwanda, Burundi, Ethiopia, Tanzania, Uganda, Mozambique, Sierra Leone, Vietnam

Evaluation of GNP per capita What are the strengths and limitations of this indicator? Strengths Limitations It shows the economical side It show the distinct differences Doesn’t show any other side but economical - Only an estimate and not an exact number

What is the PPP adjustment? Economic indicators GNP & GDP are often been criticized as being unfair measures of development, and one of the reasons why is because they don’t take into account the cost of living of the country PPP (Purchasing Power Parity) an adjustment that is made to GNP/GDP to take into account the cost of living in a country

Example of cost of living differences…. How much does a Big Mac cost in the Philippines? 85 pesos = $1.96 How much does a Big Mac cost in the USA? $2.50 -$2.99 How much does a can of Coke cost in Korea? 300-500 won = $0.3 -$0.5 How much does a can of Coke cost in India? 18-20 Rupees = $0.4-$0.5 There is a difference in the cost of living of these countries… so calculating GDP or GNP (PPP) gives a more fair measure of development because it takes into account the cost of living of the country

Social Indicators of development…. There are many social indicators of development, here are a few: Literacy, Education and skills Health Income and economic welfare Choice, Democracy, and participation Technology Infant Mortality Rate Birth / Death Rate

Social Indicators Definitions: People per doctor:– the total population divided by the number of doctors in a country Life Expectancy: The average number of years a person is expected to live in the country

People per doctor

Choropleth map showing life expectancy….

Evaluation of social indicators (people per doctor & life expectancy)….. What are the strengths and limitations of these indicators? Strengths Limitations - It has social factors - It helps to predict the limitation of people - Lack of economic factors

Social Indicators Definitions: Death/birth rate: the number of deaths/births 1000 of the population per year Infant Mortality: number of infant deaths (one year of age or younger) per 1000 live births literacy rate: % of the population over age fifteen that can read and write

Choropleth map showing birth rate per 1000 people….

Choropleth map showing infant mortality (per 1000 live berths)

Choropleth map showing literacy rates(% of population over 15 years of age)

Evaluation of social indicators (birth rate, infant mortality & literacy)….. What are the strengths and limitations of these indicators? Strengths Limitations Shows whether a country is developed or not Makes it easy to compare different counties Is not always accurate (not everyone is included) All indicators are only an average

What alternative measures are there? The United Nations Development Programme introduced a more meaningful measure of development: The Human Development Index, or HDI A composite indicator: Combines Social & Economic indicators

How does the HDI measure development? composite indicators The HDI is an index calculated from three variables: Income, measured by GDP per capita Knowledge, measured by adult literacy rates and the percentage of children attending school Longevity, measured as life expectancy at birth

Calculating HDI values…. composite indicators For each of the three values (education, life expectancy and GDP), the world’s highest and lowest values are found. The highest possible measure is given the value 1, and the lowest 0. E.g. Japan’s life expectancy is the highest at 80 years, Angola's is the lowest at 37. A country with a value mid way between the two would get a score of .50 The three variables are averaged to give a country’s HDI Activity: Define HDI and explain how it is calculated

Calculating HDI…. Country A: Knowledge 0.93 Income 0.45 Longevity 0.91 HDI = Country B: Knowledge 0.58 Income 0.88 Longevity 0.51 Country C: Knowledge 0.83 Income 0.75 Longevity 0.83 HDI = Country D: Knowledge 0.70 Income 0.61 Longevity 0.55 Analysis: What type of countries are these? Which are the most or least developed? Any resource rich countries?

Choropleth map of HDI…..

Variations in the HDI “The best”: Countries with the highest HDIs include Canada, Switzerland, Japan and Sweden. “The worst”: Countries with the lowest include Guinea, Burkina Faso and Afghanistan “The under performers”: Countries scoring high on GDP but relatively low in the HDI include Saudi Arabia, Namibia and the United Arab Emirates, suggesting need to transfer oil and mineral revenues into improved living standards. HDI can made to show regional variations

Evaluation of HDI….. What are the strengths and limitations of this indicator? Strengths Limitations Method to compare development Uses global averages to determine scores -Compares to world averages (not regional or continental) -Ceiling/floor issue (life expectancy for Japan could improve despite it having a score of 1) -HDI scores would remain constant if all countries develop at the same rate

Homework Go to wiki site and complete notes on the definition and evaluation of the different development indicators, you can also find evaluative points on the wiki site http://ismgeoe.wetpaint.com/page/Powerpoint+on+Development+Indicators

Link abbreviation with the terms Organization of Petroleum Exporting Countries Newly Industrializing Country Less Economically Developed Country Former Communist Country Purchasing Power Parity Gross National Product Gross Domestic Product Human Development Index More Economically Developed Country Least Less Economically Developed Country GDP HDI NIC MEDC LLEDC FCC PPP OPEC LEDC GNP GNP GDP HDI LEDC MEDC NIC LLEDC FCC OPEC PPP

Questions to check your understanding – GNP,GDP & HDI What is the definition of GDP? Explain GNP different to GDP? What does Per Capita mean? What type of measure of development? Why might GNP & GDP be seen as an unfair measure of development? What does HDI stand for? What does this measure of development take into account? What do the ‘underperforming’ countries on the HDI index have in common? Which measure of development do you think is the best? Explain your answer.

Other Indicators of Development MEDC LEDC High GNP/GDP High infant mortality Low birth rate High % of workers in tertiary industry High literacy levels Little access to medical care Short life expectancy Low % of workers in tertiary industry Low % of workers in agriculture High % urban dwellers Activity: Put the indicators in the columns

Social/Economic Indicators Card sort In groups sort the indicators into MEDC and LEDC and give match each description with the indicator Extension activity – create and fill in your own table – in note form and make a note Whether the indicator is ECONOMIC or SOCIAL