Development: The process of improving the material conditions of people through diffusion of knowledge and technology. Stages of Development: Less Developed Country/Developing Country More Developed Country/Developed Country

Why Does Development Vary Among Countries? Economic Indicators of Development –Gross Domestic Product GDP in Developed Countries –Average $27,000 GDP in Less Developed Countries –Average $4,000

Why Does Development Vary Among Countries? Types of Jobs –Primary Sector –Secondary Sector –Tertiary Sector JOB DISTRIBUTION VARYS BASED ON DEVELOPMENT

Why Does Development Vary Among Countries? Productivity –Productivity is the value of a particular object compared to the amount of labor needed to make it. –Value added is the gross value of the product minus the costs of raw materials and energy. Costs more to make things in the U.S. and less in China.

Why Does Development Vary Among Countries? Raw Materials –Minerals and trees that can be transformed into useful products. –Energy is a raw material. –More raw materials and energy, the better the chances of development.

Why Does Development Vary Among Countries? Social indicators of Development –Education and Literacy MDC’s and Educ. vs. LDCs and Educ. Literacy Rate –Health and Welfare Health in MDCs vs. LDCs Welfare in MDCs vs. LDCs

Why Does Development Vary Among Countries? Demographic Indicators of Development –Life Expectancy –Infant Mortality Rate –Natural Increase Rate –Crude Birth Rate

Where are More and Less Developed Countries Distributed? More Developed Regions –Anglo-America Speak English, Worship Christianity Have natural resources for manufacturing Food exporter

Where are More and Less Developed Countries Distributed? More Developed Regions –Western Europe Speak indo-European language, worship christianity Somewhat unified Not all equally developed Import food, energy, and minerals

Where are More and Less Developed Countries Distributed? More Developed Regions –Eastern Europe Communism after 1917 in Russia and after WWII in the rest More about manufacturing than producing consumer goods Dumped communism in the 1990s

Where are More and Less Developed Countries Distributed? More Developed Regions –Japan Nearly no natural resources United people willing to work hard for low wages. Skilled labor force –South Pacific Australia and New Zealand Export food and resources

Where are More and Less Developed Countries Distributed? Less Developed Regions –Latin America Speak Spanish or Portuguese, Roman Catholic Inequitable distribution of income Agricultural Productivity

Where are More and Less Developed Countries Distributed? Less Developed Regions –East Asia China – Second largest economy Communist Low wages for factory workers, drives down wages world wide. Rapidly developing

Where are More and Less Developed Countries Distributed? Less Developed Regions –Middle East Speak Arabic, Muslim religion Oil/petroleum: creates “Haves” and “Have Nots” Restrictions on women working Recognition of Isreal Terrorism

Where are More and Less Developed Countries Distributed? Less Developed Regions –Southeast Asia Tropical climate limits agriculture Grow things used in manufacturing Manufacturer of textiles Corruption of government officials

Where are More and Less Developed Countries Distributed? Less Developed Regions –South Asia India, Pakistan, Bangladesh, Sri Lanka, Nepal, Bhutan Resources but huge population Agriculture India: the world’s fourth largest economy

Where does Level of Development Vary by Gender? Gender-Related Development Index –GDI measures income, literacy, education, and life expectancy and measures men and women –A score of 1.0 is a perfect GDI score. –Norway is highest with a GDI of 0.96

Where does Level of Development Vary by Gender? Economic indicator of Gender Differences –Men make more money than women Social Indicators of Gender Differences –Education In LDCs girls usually do not attend school –Literacy Female literacy is usually low in LDCs.

Where does Level of Development Vary by Gender? Demographic indicator of Gender Differences –Life expectancy Females live longer. Usually by about six years. In LDCs women have more children

Where does Level of Development Vary by Gender? Gender Empowerment –GEM: measures the ability of women to participate in improving their lives. –Combines income and professional jobs. –A score of 1.0 is perfect. MDCs have higher GEM scores

Where does Level of Development Vary by Gender? Economic indicators of Empowerment –Northern Europe has most women in professional jobs. Political Indicators of Empowerment –Women in politics –More often in MDCs –Worldwide around 20% of Politicians are women. –The US is around 15%

Why do Less Developed Countries Face Obstacles to Development? Development through Self-sufficiency –Elements of self-sufficiency Equal spreading of investment Rural and urban incomes are close Set barriers that limit imports. (tariffs, quotas, licenses) –Local created merchandise should be cheaper

Why do Less Developed Countries Face Obstacles to Development? Problems with the Self-sufficiency Alternative –Inefficiency Self-sufficiency protects ineffective businesses. Lack of competition –Large Bureaucracy Squashes opportunity

Why do Less Developed Countries Face Obstacles to Development? Development through international trade –Rostow’s Development Model Five stage model of Development –The traditional society –The preconditions for takeoff –The takeoff –The drive to maturity –The age of mass consumption

Why do Less Developed Countries Face Obstacles to Development? Development through international trade –Rostow’s Development Model (cont.) Every country is at some level of development A country that concentrates on international trade benefits from exposure to consumers in other countries. Rostow’s model was optimistic.

Why do Less Developed Countries Face Obstacles to Development? Examples of International Trade Approach –The Four Asian Dragons Focused on only a few manufacturing goods. –Petroleum-Rich Arabian peninsula states. Oil has turned the area into a developed region Islamic principles conflict with business practices.

Why do Less Developed Countries Face Obstacles to Development? Recent Triumph of the International Trade Approach –ITA is embraced by most countries –World Trade Organization Works to even the playing field for all countries Seen as anti-democratic and invasive of national sovereignty –Transnational Corporations Invest and operate in countries other than the one they are founded in.

Why do Less Developed Countries Face Obstacles to Development? Financing Development –Loans LDCs need more money for infrastucture International Monetary Fund The World Bank Build infrastructure and it will help manufacturing Expensive and money gets stolen Many LDCs cannot pay back loans

Why do Less Developed Countries Face Obstacles to Development? Structural Adjustment Programs –An economic document that outlines goals, strategies, and objectives for achieving financial success.

Why do Less Developed Countries Face Obstacles to Development? Fair Trade –Fair trade producer Standards Fair trade: products are made and traded according to standards that protect workers and small businesses in LDCs. Allows the little guy to compete against the big guy.

Why do Less Developed Countries Face Obstacles to Development? Fair Trade –Fair trade Worker Standards Workers rights are not a high priority in the International Trade Model. Fair trade sees that children are not exploited, safety is present, workers are paid a minimum wage.