1. Splash Screen

2. Chapter Menu Chapter Introduction Section 1:Section 1:Characteristics of Developing Nations Section 2:Section 2:The Process of Economic Development Section 3:Section 3:Obstacles to Growth in Developing Nations Section 4:Section 4:Economic Development in China Visual Summary

3. Chapter Intro 1 Economists look at a variety of factors to assess the growth and performance of a nation’s economy.

4. Chapter Intro 2 What do you think it would take to improve economic conditions in less developed nations? In this chapter, read to learn how developing countries are working to become a bigger part of the global economy.

5. Chapter Preview-End

6. Section 1-Main Idea Section Preview In this section, you will learn why many nations have less industrial development and a lower standard of living than the United States.

7. Section 1-Key Terms developed nations developing nations subsistence agriculture infant mortality rate Content Vocabulary

8. Section 1-Key Terms technical fundamental Academic Vocabulary

9. A.A B.B C.C Section 1-Polling Question Do you think that there are more developed or developing nations? A.More developed nations B.More developing nations C.About equal numbers of developed and developing nations

10. Section 1 Developed and Developing Nations Developed nations have increased their standards of living by moving from agricultural to industrialized economies.

11. Section 1 Developed and Developing Nations (cont.) There are more than 190 nations in the world. 35 are considered developed nations.developed nations –The U.S., all European countries, Japan, Australia, and New Zealand are examples.

12. Section 1 Developed and Developing Nations (cont.) The remaining people in the world live in developing nations. developing nations –Religion influences economic policies in some developing countries.

13. A.A B.B C.C Section 1 Do you feel that the U.S. should help developing nations with increased foreign aid? A.Definitely B.Maybe C.Not at all

14. Section 1 Economic Characteristics Developing nations are usually characterized by low GDP per capita, emphasis on agriculture, poor health conditions, low literacy rates, and rapid population growth.

15. Section 1 Economic Characteristics (cont.) Economists often use per capita GDP as a rough measure of a nation’s prosperity. View: Measuring GDPMeasuring GDP Some characteristics of developing nations: –A low GDP –Reliance on subsistence agriculturesubsistence agriculture

16. Section 1 Economic Characteristics (cont.) –Poor health conditions, including a high infant mortality rate infant mortality rate View: Economic and Social Statistics for Selected NationsEconomic and Social Statistics for Selected Nations –Low literacy rate –Rapid population growth

17. A.A B.B C.C D.D Section 1 If a developing country was going to try to address their problems, which do you think should be addressed first? A.Subsistence agriculture B.Poor health conditions C.Low literacy rate D.Rapid population growth

18. Section 1 Weak Property Rights A weak system of legally protected property rights frequently undermines economic development.

19. Section 1 Weak Property Rights (cont.) Economists have found that governments in developing countries generally do not support a system of strong, well-defined property rights. –Without specifically defined private- property rights, individuals cannot exchange land, and no large-scale farming can take place. –There is also little incentive to improve value of the property they farm.

20. A.A B.B C.C Section 1 Can you name some more reasons that owning a specific plot of land is important? A.Many reasons B.Some reasons C. No reasons

21. Section 1-End

22. Section 2-Main Idea Section Preview In this section, you will learn how foreign investment and aid help nations to develop economically.

23. Section 2-Key Terms confiscation foreign aid economic assistance technical assistance military assistance Content Vocabulary

24. Section 2-Objectives devote enhance Academic Vocabulary

25. A.A B.B C.C Section 2-Polling Question Can you describe the three stages of economic development? A.Yes B.Some of them C.None at all

26. Section 2 Financing Economic Development The major outside sources of capital for developing nations are foreign investment and aid from developed nations.

27. Section 2 Financing Economic Development (cont.) The two major outside sources of capital for developing nations are: –Investment by foreign businesses –Risks include: Unstable governments and terrorist groups threaten stability Foreign businesses may lose their investment through confiscationconfiscation

28. Section 2 Financing Economic Development (cont.) –Foreign aid from developed nationsForeign aid –Types of foreign aid include: Economic assistance Technical assistance Military assistance

29. A.A B.B C.C D.D Section 2 Do you agree or disagree with the idea of supplying foreign aid? A.Strongly agree B.Mildly agree C.Mildly disagree D.Strongly disagree

30. Section 2 Who Supplies Foreign Aid The United States devotes a smaller fraction of its GDP to foreign aid than many other countries.

31. Section 2 Who Supplies Foreign Aid (cont.) Many developed nations, such as the U.S., offer some type of foreign aid to developing nations. –The United States channels much of its foreign aid to other nations through the U.S. Agency for International Development (USAID). –Funds are also channeled through United Nations agencies, including the World Bank and the International Monetary Fund (IMF). View: Sources of AidSources of Aid

32. A.A B.B C.C D.D Section 2 Where does most U.S. foreign aid go? A.The Middle East and Southeast Asia B.Africa and Asia C.India and the Middle East D.Latin America and Asia

33. Section 2 Reasons for Giving Foreign Aid Foreign aid is motivated by both humanitarian and political considerations.

34. Section 2 Reasons for Giving Foreign Aid (cont.) The basis for giving foreign aid includes: –Humanitarianism –Economics—encourages international trade and opportunities for private investment –Politics—stop communism, promoting democracy –Protect national security—foreign aid can promote military alliances

35. A.A B.B C.C D.D Section 2 Which reason for giving foreign aid do you think is the most important? A.Humanitarian B.Economic C.Political D.National security

36. Section 2-End

37. Section 3-Main Idea Section Preview In this section, you will learn about the problems that developing nations face when trying to achieve economic growth.

38. Section 3-Key Terms bureaucracies capital flight Content Vocabulary

39. Section 3-Objectives regime substitute subsequent Academic Vocabulary

40. A.A B.B C.C Section 3-Polling Question Should the United States give foreign aid to a country that may have a corrupt government? A.Yes B.Sometimes C.No

41. Section 3 Four Obstacles to Growth Local traditions, rapid population growth, misuse of resources, and trade restrictions can all hinder economic development.

42. Section 3 Four Obstacles to Growth (cont.) Why did Europe thrive due to foreign aid? Europe after WWII already had skilled labor forces, corporations and trade groups, and experienced government bureaucracies. bureaucracies

43. Section 3 Four Obstacles to Growth (cont.) Four obstacles developing nations face: –People’s attitudes and beliefs –High population growth rate

44. Section 3 Four Obstacles to Growth (cont.) –Misuse of resources Corruption among government leaders. Capital flight Crushing debt from previous regimes –Trade restrictions View: Capital FlightCapital Flight

45. A.A B.B C.C D.D Section 3 Which obstacle do you feel should be addressed first and why? A.Attitudes and beliefs B.Population growth C.Misuse of resources D.Trade restrictions

46. Section 3 Case Study: Indonesia The availability of natural resources or money for investment does not guarantee economic development if unstable conditions or other obstacle to growth are present.

47. Section 3 Case Study: Indonesia (cont.) Lessons learned through Indonesia: –Simply pouring money capital into a developing nation will not guarantee economic growth. –Countries needs a national identity and their attitudes may need to be changed. –Growth can occur if government restrictions on economic activity are reduced.

48. Section 3 Case Study: Indonesia (cont.) –Foreign aid must be used wisely in combination with domestic savings, foreign investment, and government policies that ensure economic stability. –Growth of a developing nation’s economy may prove temporary if it depends on only one or two products. View: Indonesia’s Economy Under Sukarno and SuhartoIndonesia’s Economy Under Sukarno and Suharto

49. A.A B.B C.C D.D Section 3 One of the reasons Indonesia’s economy failed was a lack of which resources or issue? A.Minerals and oil B.Farmland and rainforests C.A national identity D.Enough foreign aid

50. Section 3-End

51. Section 4-Main Idea Section Preview In this section, you will learn about the reasons for the rapid growth of China’s economy over the past several years.

52. Section 4-Key Terms five-year plans Content Vocabulary

53. Section 4-Objectives interval notion Academic Vocabulary

54. A.A B.B C.C Section 4-Polling Question Do you know why China is so economically successful? A.Yes B.Somewhat C.Not at all

55. Section 4 Development of China’s Economic System China’s rapid economic growth is a result of recent free-market reforms.

56. Section 4 Development of China’s Economic System (cont.) In 1953, the Chinese government began an economic system based on five-year plans.five-year plans Plan was eventually transformed to a regional planning system and then to a limited free enterprise.

57. Section 4 Development of China’s Economic System (cont.) –Due to various reforms in 1978, such as private individuals permitted to rent land for up to 15 years, overall farm productivity increased dramatically. Rural residents moved to cities to work in factories and offices. Overseas companies invested in business ventures. Economic growth remains at 7 to 10 percent per year.

58. A.A B.B C.C D.D Section 4 The following changes have led to China’s economy EXCEPT A.Giving some decision-making powers to local government. B.Permitting private individuals to rent land for up to 15 years. C.Giving people new businesses to run. D.The movement of people to cities to work in factories and offices.

59. Section 4 The Transition Toward a Mixed Economy The legal protection of some private property has encouraged the private investment necessary for China’s transition to a mixed economy.

60. Section 4 The Transition Toward a Mixed Economy (cont.) Countries shifting from non-capitalist to capitalist systems all face the same problem—how to establish rule of law. Throughout China there is an atmosphere of lawlessness and unpredictability for anyone in the business world due to a lack of specific property rights.

61. Section 4 The Transition Toward a Mixed Economy (cont.) As a result of quick economic growth, China is the second biggest producer of undesirable gas emissions in the world. In addition, about 70% of China’s rivers and lakes are polluted.

62. A.A B.B C.C Section 4 Are you familiar with the problems the black market can cause? A.Very familiar B.Somewhat familiar C.Not familiar

63. Section 4 Prospects for China’s Economic Future China has encouraged foreign investment in its economy to promote growth and access to global markets.

64. Section 4 Prospects for China’s Economic Future (cont.) WTO membership in 2000 has increased the prospects for a more prosperous, democratic, and stable China.

65. A.A B.B Section 4 As a result of being admitted to the WTO, China did not have to face many economic reforms. A.Yes B.No

66. Section 4-End

67. VS 1 Economists use per capita GDP as a measure of a nation’s prosperity. There is a huge difference in per capita GDP between developed and developing nations.

68. VS 2 Although developing nations receive capital from developed nations in the form of foreign investment and aid, they still face obstacles to growth.

69. VS 3 China’s rapid economic growth is a result of recent free-market reforms. An American visitor to Beijing would find that city to be very much like large cities in the United States.

70. VS-End

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76. Concept Trans Menu Economic Concepts Transparencies Transparency 22Transparency 22 International Aspects of Growth and StabilityInternational Aspects of Growth and Stability Select a transparency to view.

77. Concept Trans 1

78. DFS Trans 1

79. DFS Trans 2

80. DFS Trans 3

81. DFS Trans 4

82. Vocab1 developed nations: nations with relatively high standards of living and economies based more on industry than on agriculture

83. Vocab2 developing nations: nations with little industrial development and relatively low standards of living

84. Vocab3 subsistence agriculture: growing of just enough food by a family to take care of its own needs; no crops are available for export or to feed an industrial workforce

85. Vocab4 infant mortality rate: death rate of infants who die during the first year of life

86. Vocab5 confiscation: taking over industries by governments without paying for them

87. Vocab6 foreign aid: funds, goods, and services given by governments and private organizations to help other nations and their citizens

88. Vocab7 economic assistance: loans and outright grants of funds or equipment to other nations

89. Vocab8 technical assistance: aid in the form of engineers, teachers, and technicians to teach skills to individuals in other nations

90. Vocab9 military assistance: aid given to a nation’s armed forces

91. Vocab10 bureaucracies: offices and agencies of the government that each deal with a specific area

92. Vocab11 capital flight: the legal or illegal export of currency or money capital from a nation by that nation’s leaders

93. Vocab12 five-year plans: centralized planning system that used to be the basis for China’s economic system; eventually was transformed to a regional planning system leading to limited free enterprise

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