Chapter 21 Concepts of Development

GNP: Gross National Product GNP:Total value of all goods and services produced whether earned within the country or abroad. by its economy during a given year. GDP: Gross Domestic Product - only goods and services produced within a country during a given year. Used for measuring the development status of countries Drawback-nothing mentioned about the distribution of wealth

GNP (Gross National Product) World bank data shows that, in 1998, the highest GNP country - Liechtenstein with $50,000, followed by Luxembourg ($43,570), Switzerland ($$40,080) 1 Liechtenstein 2 Luxenmbourg 3 Switzerland 4 Norway 5 Bermuda 6 Denmark 7 Japan 8 Cayman Islands 9 Singapore 10 United States 11 Iceland 12 Austria 13 Germany 14 Sweden 15 Belgium 16 Monaco 17 France 18 Netherlands 19 Finland 20 Brunel 21 Hong Kong 22 UK 23 Australia 24 Italy 25 Canada 50,000 43,570 40,080 34,330 34,000 33,260 32,380 31,000 30,060 29,340 28,010 26,850 25,850 25,620 25,380 25,000 24,940 24,760 24,110 24,000 23,670 21,400 20,300 20,250 20,020

Developed, developing and underdeveloped countries DCs- high levels of urbanization and high standards of living Underdeveloped Developing countries

Classification of Development - Criticisms Terminology Not all the countries will follow the same route Western bias It doesn’t point out sources of influences

Divisions between well-off and less well-off economics are arbitrary Problem of Data- unreliable, inadequate and incompatible data Problems from measures Measures of Development GNP Occup. Structure of the Labor Force Productivity per worker Consumption of Energy per person Transportation and Communications facility per person Consumption of Manufactured Metals per person Rates

The Core-Periphery Model- focuses on attention on the economic relationships among places Semi- periphery Core Regions: achieved high levels of socioeconomic prosperity, dominant player in global economic game Periphery: poor countries do not have control over their own affairs

Core-Periphery model A key component of many theories, including “World System Theory” proposed by Immanuel Wallerstein Major difference to D-D-U model (Development Concept) – make power relations among places explicit and does not assume that socioeconomic change will occur in the same way in all places, and scale- sensitive: (see next)

Los Angeles Economic and social core region of Southern California Japan-Economic core region of the world Core-periphery relationship in various scale Taipei: Economic and social core region of Taiwan

Patterns on the map Figure 21-1 shows the world economies based on the data from the World Bank. Low-income:56 countries. The lowest ones include: Cambodia, Mocambique, Ethiopia, Chad, Tanzania and Congo. 4 in western hemisphere. Middle-income:47 in lower-middle, 18 in upper-middle income High-income:Oil-rich countries in Southwest Asian, Western European countries, Japan, S. Korea, Taiwan, US, Canada, New Zealand and Australia

Conditions in Periphery High Birth Rate High Infant Mortality Low life expectancy High illiteracy rate Protein deficiency High patient/doctor ratio Few hospitals Inadequate sanitary sys Fragmented landholding Lack of tools and equipments Women workload high Subsistence farming Soil erosion Unemployment high Over-crowded urban areas Poor housing Small mid-income groups Incomes go to food and basic needs PopulationPopulation HealthHealth RuralRural UrbanUrban

Tourism in Peripherals Hotels owned by large multinational corporations not the local companies except for countries such as Thailand, Kenya, Barbados and Fiji. “Demonstration Effect” Small scale local business is not benefited from the tourism Irritant industry

Models of Development Liberal Models – all countries are at the same stage along a development trajectory. All the countries are capable of development Structural models- all things are structured and organized so that it is hard to change the situation for poorer countries.

Walt Rostow’s Modernization Model – liberal model Traditional, subsistence farming, resistance to technological change Progressive leadership move country toward greater openness, flexibility and diversification Urbanization, industrialization, technological and mass-production occur Technology diffuse, industrial specialization, international trade expands, modernization Rate of pop growth reduced High income/consumption, service sector employment Criticism: Not take into account 1)Diff constraints 2)Cultural differences Traditional Pre-takeoff Takeoff Drive to maturity Final

Dependency Theory Structuralist alternative to Modernization model The political and economic relationship between countries control and limit the economic development possibilities of less well-off areas. Colonies and colonist: dependent and dominant Still, this theory doesn’t explain the difference in culture, politics and society

A changing world Mexico, Brazil, Thailand and Malaysia are at takeoff stage. Sweden and New Zealand - capitalist with socialist principles China - socialist (communist) with capitalist economics. Politics and economics are closely intertwined