3.7 - The Development Gap

Question 1

Economic ways to measure development

Answer 1

Income per capita
- The mean average income of a group of people
- The total source of income for a country and divided by the population to provide an average

Economic sector balance
- The economy is split into four economic sectors and their importance changes as a country develops
- Estimation of the contribution of each economic sector to the total national income

Question 2

Social ways to measure development

Answer 2

Human development index
- A composite indicator, created by the UN, that ranks countries according to economic and social criteria
- The three measures (life expectancy, income and education) are scored between 0 (worst) and 1 (best). An average score is then taken to rank all the countries in the world

Gender inequality index
- A composite indicator, created by the UNDP, measuring gender inequalities linked to three aspects: reproductive health, empowerment and labour force participation rate
- Countries are scored between 0 and 1. The higher the value, the greater the inequality

Environmental quality (air pollution indices)
- Measured using the global Environmental Performance Index (EPI) which looks at the amount of pollution outdoors as well as the quality of air inside homes
- Countries are ranked in order according to their performance across 11 areas related to environmental quality

Question 3

What is the gini coefficient

Answer 3

• The Gini Coefficient is a measure of inequality in the distribution of household income
• Countries are scored between 0 and 100, the higher the value, the greater the income inequality
• A score of 0 suggests that everyone has the same income in a country, a score of 100 suggests a single person receives all of a country’s income

Question 4

What is the Lorenz curve

Answer 4

• The bigger area A is the more unequal a society is
• The bigger area B is the more equal a society is
• Rough estimate of squares in A/(A+B) = gini coefficient
• 0 = perfect equality
• 0.4 and above = high level of income inequality
• 1 = perfect inequality

Question 5

Examples of winners of globalisation

Answer 5

• There are currently 2,668 billionaires globally, most made their wealth through ownership of TNCs
• Developed countries have been good at maintaining their wealth, even with competition from emerging economies such as China
• Factory and call centre workers in Asia have a better, more reliable income

Question 6

Examples of losers of globalisation

Answer 6

• There are still rural areas in Asia and Sub-Saharan Africa which remain isolated, with few global connections
• Many workers in industrial cities within developed countries have lost jobs as manufacturing relocated
• Workers in sweatshops are exploited - forced to work in poor conditions for low pay

Question 7

How has GDP changed overtime in different regions

Answer 7

All regions have seen a rise in GDP per capita since 1820, however the rise in Africa, Asia and Latin America has been significantly less than Western Europe and the USA

Question 8

How has globalisation caused environmental issues

Answer 8

• Many global environmental issues can be linked to globalisation for example: Converting 40% of the world’s terrain into productive agricultural land has resulted in the loss of habitats and biodiversity
• These environmental issues have been felt more by developing and emerging countries
• There is now a greater awareness of these risks to the environment that can be associated with globalisation, therefore there is a bigger focus on environmental management now