Patterns of Development and Change

Patterns of Development and Change

Key words • Circular and cumulative causation • Core-periphery model • Cultural convergence • Development • Gross domestic product (GDP) • Gross national product (GNP) • Purchasing power parity (PPP) • Spread effect • Technology • Technology gap • Technology transfer • Third World • Trickle down effect • underdevelopment

Development The process of growth, expansion, or realization of potential; bringing regional resources into full productive use.

Underdevelopment A level of economic and social achievement below what could be reached – given the natural and human resources of an area – were necessary capital and technology available

Figure 10.3 Comparative development levels. The “North – South” line of the 1980 Brandt Report suggested a simplified world contrast of development and underdevelopment based largely on degree of industrialization and per capita wealth. More recently, the United Nations General Assembly recognized 45 “least developed countries.” That recognition reflects low ratings in three indicators: gross domestic product, share of manufacturing in the GDP, and literacy rate. The “industrial countries” are those identified in 1995 as most developed by the United Nations Development Program.

Gross National Product (GNP) • The total value of goods and services (with some adjustments) including income received from abroad, produced by the residents of a country during a specified period (usually a year).

Figure 10.7 Gross national product per capita. GNP is a frequently employed summary of economic advancement, though high incomes in sparsely populated, oil-rich countries may not have the same meaning in developmental terms as do comparable per capita values in industriallly advanced states. The map implies an unrealistic precision. For namy states, when uncertain GNP is divided by unrepliable population totals, the resulting per capita is at best a rough approximation that varies between reporting agencies. A comparison of this map and Figure 10.11presents an interesting study in regional contrasts

Gross Domestic Product (GDP) The total value of goods and services produced within the borders of a country during a specified time period, usually a calendar year.

Purchasing Power Parity (PPP) A monetary measurement which takes account of what money actually buys in each country.

Figure 10.8 Purchasing Power Parity (PPP) When local currency gross domestic product is converted into purchasing power parities, there is a towfold revision of the usual view of world economic status. The first result is a sharp increase in the developing coutries’ share of total world output. By varying calculations, China now falls somewhere between the world’s second and ninth largest economy, and India, Brazil, Mexico all emerge as bigger than Canada. Second, the abject poverty suggested by per capita gross national or gross domestic product is seen to be much reduced in many developing countries. India, for example, shows a 1992 GDP per capita at market exchange rates of $310; in purchasing power parity, the figure rises to over $1200, and Parkistan’s people jump from $420 to nearly $3000. Compare this map with Figure 10.7 to see how PPP changes our impressions of some countries’ economic status

Relative Characteristics of Development

Third World Originally (1950S ), designating countries uncommitted to either the “First World”. Western capitalist bloc or the Eastern “Second World communist bloc, subsequently a term applied to countries considered not yet developed or in a state of underdevelopment in economic and social terms

Core-Periphery Model A model of spatial structure of an economic system in which underdevelopment or declining peripheral areas are defined with respect to their dependence on a dominating developed core region

Circular and Cumulative Causation A process through which tendencies for economic growth are self-reinforcing; an expression of the multiplier effect, it tends to favor major cities and core regions over less advantaged peripheral regions.

Spread Effect • (syn: trickle – down effect) The diffusion outward of the benefits of economic growth and prosperity from the power center or core area to poorer districts and people.

Technology Gap • The contrast between the technology available in developed core regions and that present in peripheral areas of underdevelopment.

Cultural Convergence The tendency for cultures to become more alike as they increasingly share technology and organizational structures in a modern world united by improved transportation and communication

Technology Transfer The diffusion to or acquisition by one culture or region of the technology possessed by another, usually more developed, society.

Noneconomic Measures of Development • Education • Public Services • Health

Education Adult literacy rates by country (over 15 years of age) able to read and write short Source: UNESCO Institute for Statistics, Data Centre, June 2007.

Public Services • The quality of Public Services and the creation of facilities to assure the health of the labor force are equally significant evidences of national advancement.

Health • Access to medical facilities and personnel is another spatial variable with profound implications for the health and well-being of populations.

Aggregate Measures of Development and Well-Being • Seeking a value-free measure of the extent to which minimum human needs are being satisfied among the world’s countries, the Overseas Development Council devised a Physical Quality of Life Index (PQLI). • Three indicators: infant mortality, life expectancy, and literacy

Human Development Index (HDI) • The HDI reflects the Programme’s conviction that the important human aspirations are leading a long and healthy life, receiving adequate education and having access to assets and income sufficient for a decent quality of life.

The Role of Women • Gender in the cultural sense refers to socially created - not biologically based - distinctions between femininity and masculinity. • Much of sub-Saharan Africa and in South and Southeast Asia, women became responsible for most of the actual field work, while still retaining their traditional duties in child rearing, food preparation, and the like.

Does Foreign Aid help? • Since the 1970s, the industrial countries have annually spent about one-third of one percent of their gross domestic product on aid to developing countries. In addition, large sums have flowed from “North” to “South” in the form of direct loans from individual countries and such international institutions as the WWB, the IMF, and regional development banks. Poor countries owed nearly $2 trillion in development ralated debts to outside lenders in 1995. • The official goal of foreign aid is, usually, to help the poor and to develop the infrastructure essential to encourage economic and social development. In reality, much aid seems driven by the political interests of donor countries rather than by the developmental needs of the recipients. Whatever the motive, the results have been less substantial than the amounts donated or loaned.

Analysis of aid flows to nearly 100 countries since the 1970s reveals that in almost all cases aid is spent entirely on comsumption of goods and services – for the most part by governments and the already well-to-do elites – with rarely a big increase in investment. • Even countries that receive aid equal to 15% of their GDP have no greater improvement in basic measures of human development or economic growth than countries receiving no aid.

Increasingly, aid recipients are also debtor countries, saddled with repayment obligations that overwhelm their national budgets and prevent expenditures from domestic funds on health care, education, infrastructure development, and the like. • Aid and loans have proved more detrimental than asvantageous as the burden of economic reform programs falls heavily on the poorest of their populations.

Much of that money goes to a relatively few countries with which the U.S has speciak relationships, Egypt and Israel, for example, together received 40% of the total in 1996. On a worldwide scale, critics contend, little of the aid from the rich “North” has been invested in places that need it most. • Those who support continuation fits rather than weahens the national economy. Almost 75% of foreign assistance flows back in the form of tied purchases of Amercican services and agricultural and manufactured goods.

Question • Do you feel that the amount the U.S spends on foreign aid is too much, too little, or about right? If too much, do you advocate cutting foreign aid? If too little, qould you support an increase in the federal budget aid allocation? What are your reasons for your opinions?

Question 2. One widely-held opinion is that money now spent on direct and indirect foreign aid more properly should be spent on domestic programs dealing with poverty unempoyment, homelessness, inner-city decay, inequality, and the like. An equally strongly-held contrary view is that foregin aid should take priority, for it is needed to address world and regional problems of overpopulation, hunger, disease, destruction of the environment, and civil and ethnic strife those conditions foster. Assuming you had to choose one of the two polar positions, which view would you support and why?

Summary • Developed, developing, underdeveloped, least (or less, developed, Third World, anf the like). • Gross national product and purchasing power parity per capita document the basic core • A high percentage of a country’s workforce in agriculture is associated with less developed subsistence economies with low labor productivity and low levels of national wealth. • Although the correlation is not axact, countries registering average caloric intake below daily requirements are also countries registering poorly on all purely economic measures of development.

Patterns of Development and Change