1. Economic Development
Economics Chapter 18

2. Levels of Development
Economists use data to compare the economies of nations and how the economy impact people’s standard of living. Miniature Earth Video

3. Levels of Development Developed Nation Market Economy
Relatively high standard of living
High GDP
Industrialization
Widespread private ownership of property
Stable & effective government
Example: United States

4. Levels of Development Transitional Economy
A country that has moved or is moving from a command economy towards a market economy
Example: China

5. Levels of Development Less Developed Countries (LDC)
Less well developed industry
Lower GDP
Lower standard of living
Lack of infrastructure
Basic support systems needed for an economy to run.

6. Standards of Economic Development
Economists use data to measure levels of economic development. Per Capita GDP – a measure of a country’s wealth per person

7. Standards of Economic Development
Infant Mortality Rate - The number of children who dies in the first year per 1,000 live births. Life Expectancy – Average lifespan of a person. Literacy Rate – Percentage of people over 15 who can read and write Human Development Index (HDI) – Combination of other stats including per capita GDP, literacy rate, student enrollment.

8. Standards of Economic Development
Consumption of Goods & Services How people spend their money after meeting their needs. Bigger ticket items such as appliances indicate a more developed economy as well as an increasing standard of living. Energy Use Energy use is an indicator of the level of economic development. This includes individual use as well as how energy use differs between commercial and private use.

9. Standards of Economic Development
Labor Force The types of jobs available indicate level of economic development.

10. Questions
Why is per capita GDP more useful than overall GDP when comparing nations?
What does a nation’s infrastructure say about the country’s level of economic development?
Compare and contrast three characteristics of a developed nation and a less developed nation.

11. A Framework for Development
Chap 18 Section 2

12. What is needed for a nation to develop?
Resources
Natural resources
Human Capital
Physical Capital
Stability
Government Institutions
Stable Prices
Protected Property Rights

13. What is needed for a nation to develop?
Opportunity
Open International Trade
Social and Economic Mobility
Control Corruption
Limit Regulation
Financial Support
Internal Investment
Foreign Investment
Loans and Aid
International Help Agencies

14. Challenges of Transitioning to a Market Economy
Poor Infrastructure
Privatization
Rise in Prices

15. Market Transition Examples
Russia and Eastern Europe
(pg )
China (pg )

16. China’s Campaign for Economic Power
Read the Background and Issue on page 570 of the text.
Review the documents provided.
Answer questions 1 – 3 in a group of
2 -3 people.