1. Less Developed Countries Rich democracies ▫Small percentage of world’s countries/population ▫Distinguishing characteristics  High level of citizen capability  Innovative/productive economic systems  Effective, democratic states Less developed countries (LDCs) ▫Africa, Asia, Central and Latin America, Middle East ▫Lower levels of citizen capability ▫Less innovative and productive economies ▫Less effective states (that make rules encouraging economic development and distribute results of development to benefit large numbers of citizens)

2. Economic development Economic development = process of increasing country’s wealth by diversifying goods and services produced and increasing efficiency of production ▫Economic development in LDCs (agriculture/industry/service)  Diversification from single major crop to several crops  Development of new industries (textiles, garments)  Increasingly sophisticated manufacturing processes  Rising per capital income ▫Newly industrialized countries (NICs) – South Korea, Taiwan, Brazil; most successful economic developers among LDCs  Requires sophisticated technology, skilled workers, capable managers, effective banking/financial institutions, political leaders, state bureaucracy

3. Human Development Human development = process of expanding choices people have to lead lives they value ▫Physical needs ▫Safety ▫Informed decision-making ▫Social and political rights Substantive freedoms members of society enjoy Economic development and human development ▫Generally, higher economic development leads to higher citizen capability ▫Common measure of human development: Human Development Index (HDI) (life expectancy, literacy, purchasing power)  Positive correlation between economic development and HDI (higher per capita income, higher HDI)  Depends on how benefits of economic growth are used/distributed  Depends on political economy, balance of power between competing groups/classes

4. Less Developed Countries (LDCs) More numerous and diverse than Rich Democracies (DCs) ▫Some have achieved economic development; others haven’t ▫Some are democracies; others are authoritarian ▫Some have increased capabilities; others haven’t High percentage of citizens have low capabilities Economies are less productive and more vulnerable to external shocks Tend to have weaker, less democratic states

5. Citizens’ Capability Higher percentage lack freedom to choose kinds of lives they have reason to value Significant regional differences ▫Extreme low capability in South Asia (largest numbers overall) and sub-Saharan Africa (highest percentage) ▫Capability by region (Table 7.2, 192) Linked to extreme/absolute poverty ▫Individuals/families have difficult time buying food, medicines, housing; don’t have access to clean water, education ▫Highest percentage in absolute poverty, sub-Saharan Africa; second highest, South Asia ▫Absolute poverty by region (Table 7.3, 193)

6. Poor and vulnerable economies Leads to lower per capita incomes ▫Lowest per capita incomes, Sub-Saharan Africa ▫See Per Capita Income by region, Table 7.4, 194 More vulnerable to economic shocks from the world economy ▫Oil price increases ▫Loan interest rates ▫Falling prices on key exports (crops, minerals) ▫Withdrawal of foreign investment

7. Weaker, less democratic states Strong, effective states can promote economic development and distribute fruits of development in ways that benefit large percentage of population Strong states = able to defend territory, maintain order, implement policies throughout the country (democracies can be strong states) ▫Collect taxes (to pay for defense, healthcare, education) ▫Competent, well-trained bureaucracies ▫High levels of legitimacy (support, authority) Two dimensions: capacity (ability to implement decisions effectively) and autonomy (to make decisions and policies independent of individuals/ groups in society) States in LDCs are typically weak (whether authoritarian or democratic) ▫Unable to translate power into action, implement policies effectively ▫Maintain law and order; limited authority ▫Corrupt bureaucracies  Corruption = behavior which deviates from formal duties of public role (make money, increase status); weakens the state, has biggest negative impact on society’s poorest members States in LDCs tend to be less democratic ▫Many have democratic facades ▫Many are authoritarian without democratic pretense (especially in Middle East)

8. Why development gap? Geography, culture, imperialism/colonialism, leadership Geography ▫Jared Diamond, Guns, Germs, and Steel ▫Some regions of the world became more powerful, wealthy because of advantages due to location  Eurasia – domesticated plants, animals  large, dense, stratified societies  specialization  technological developments  conquest, colonialism ▫Differences in resources, access to ports, war, disease

9. Why development gap? Culture = values, attitudes, beliefs, orientations and underlying assumptions prevalent among people in society ▫Presence of certain values and beliefs make some societies more productive and democratic than others  Weber (Protestant Ethic and the Spirit of Capitalism – work, effective use of time, reinvestment)  Landes (work ethic more important than geography, institutions)  Fukuyama (level of trust inherent in society; lubricant that makes organization function effectively; social capital = informal values, norms that enable people to trust one another and cooperate effectively)

10. Why development gap? Imperialism = economic or political domination of one region or country by another Colonialism = establishment of formal control (boundaries, governments, sovereign power) ▫Shaped LDCs economies, political cleavages, and governments ▫European/American/Japanese colonialism  Latin and Central America, Middle East, Asia, Africa Reshaped economies, societies, and politics of colonies to meet their needs ▫Economies based on export crops and raw materials (disrupted local industries, prevented new ones)  Colonial powers focused on industrial production  Dependent on small number of crops and raw materials Social cleavages that have caused severe political conflict ▫Class, racial, and religious cleavages Political institutions that perpetuate economic patterns and conflicts ▫Colonial powers typically left ineffective states

11. Why development gap? Leadership ▫Choices leaders have made since independence Development a result of more than position at independence Also a function of political will (decisions, agency) and skill ▫Choosing successful development policies ▫Building coalitions of support ▫Promoting effective economic/political institutions Kinds of regimes leaders construct