Econ Flashcards
(121 cards)
1
Q
HDI
A
Human Development Index
2
Q
An organization known as an “international financial institution”
that provides development
funds to developing countries
in the form of interest-bearing
loans, grants, and technical
assistance.
A
World Bank
3
Q
In the World Bank
classification, countries with
a GNI per capita of less than
$1,025 in 2011.
A
Low-income countries
4
Q
In
the World Bank classification,
countries with a GNI per capita
between $1,025 and $12,475
in 2011
A
Middle-income countries
5
Q
Countries at a relatively advanced
level of economic development with a substantial and
dynamic industrial sector and
with close links to the international trade, finance, and
investment system.
A
Newly industrializing
countries (NICs)
6
Q
Newly industrializing
countries (NICs)
A
Countries
at a relatively advanced
level of economic development with a substantial and
dynamic industrial sector and
with close links to the international trade, finance, and
investment system.
7
Q
A UN designation of countries
with low income, low human
capital, and high economic
vulnerability
A
Least developed countries
8
Q
Least developed countries
A
A UN designation of countries
with low income, low human
capital, and high economic
vulnerability
9
Q
Productive investments in people, such
as skills, values, and health
resulting from expenditures
on education, on-the-job
training programs, and
medical care.
A
Human capital
10
Q
Human capital
A
Productive
investments in people, such
as skills, values, and health
resulting from expenditures
on education, on-the-job
training programs, and
medical care.
11
Q
The total domestic
and foreign output claimed by
residents of a country, consisting of gross domestic product
(GDP) plus factor incomes
earned by foreign residents,
minus income earned in the
domestic economy by nonresidents.
A
Gross national income
(GNI)
12
Q
Gross national income
(GNI)
A
The total domestic
and foreign output claimed by
residents of a country, consisting of gross domestic product
(GDP) plus factor incomes
earned by foreign residents,
minus income earned in the
domestic economy by nonresidents.
13
Q
The portion of a product’s final value that
is added at each stage of production.
A
Value added
14
Q
Value added
A
The portion of a product’s final value that
is added at each stage of production.
15
Q
The wearing out of
equipment, buildings, infrastructure, and other forms of
capital, reflected in write-offs
to the value of the capital
stock.
A
Depreciation (of the capital
stock)
16
Q
Depreciation (of the capital
stock)
A
The wearing out of
equipment, buildings, infrastructure, and other forms of
capital, reflected in write-offs
to the value of the capital
stock.
17
Q
The total
amount of physical goods
existing at a particular time
that have been produced for
use in the production of other
goods and services.
A
Capital stock
18
Q
Capital stock
A
The total amount of physical goods
existing at a particular time
that have been produced for
use in the production of other
goods and services.
19
Q
The total final output
of goods and services produced by the country’s economy
within the country’s territory
by residents and nonresidents,
regardless of its allocation
between domestic and foreign
claims.
A
Gross domestic product
(GDP)
20
Q
Gross domestic product
(GDP)
A
The total final output
of goods and services produced by the country’s economy
within the country’s territory
by residents and nonresidents,
regardless of its allocation
between domestic and foreign
claims.
21
Q
Calculation of GNI using a common set of international prices for all goods and services, to provide more accurate comparisons of living standards.
A
Purchasing power parity
(PPP)
22
Q
Purchasing power parity
(PPP)
A
Calculation of GNI using a common set of international prices for all goods and services, to provide more accurate comparisons of living standards.
23
Q
An index measuring
national socioeconomic development, based on combining
measures of education, health,
and adjusted real income per
capita.
A
Human Development Index
(HDI)
24
Q
The concept that the subjective
value of additional consumption lessens as total consumption becomes higher.
A
Diminishing marginal utility
25
Diminishing marginal utility
The concept that the subjective
value of additional consumption lessens as total consumption becomes higher.
26
HDI
Dimension index =
Actual Value - Minimum Value
———————————————
Maximum Value - Minimum Value
27
Max Life expectancy
85
28
Max Life expectancy
85
29
Max Life expectancy
85
30
Min life expectancy
20
31
Min expected years of schooling
0
32
Max expected years of schooling
18
33
Max mean of schooling
15
34
Min mean of schooling
0
35
Max GNI per capita
75,000
36
Min GNI per capita
100
37
Very high human development
0.800 & above
38
High human development
0.700 & 0.799
39
Medium human development
0.550 & 0.699
40
Low human development
Below 0.0550
41
The
situation of being unable or
only barely able to meet the
subsistence essentials of food,
clothing, shelter, and basic
health care.
Absolute poverty
42
Absolute poverty
The situation of being unable or
only barely able to meet the
subsistence essentials of food,
clothing, shelter, and basic
health care.
43
The number of children born alive each
year per 1,000 population.
Crude birth rate
44
Crude birth rate
The number of children born alive each
year per 1,000 population.
45
The
proportion of the total population aged 0 to 15 and 65+,
which is considered economically unproductive and therefore not counted in the labor
force.
The dependency burden
46
The dependency burden
The
proportion of the total population aged 0 to 15 and 65+,
which is considered economically unproductive and therefore not counted in the labor
force.
47
Significant
ethnic, linguistic, and other
social divisions within a
country
Fractionalization
48
Fractionalization
Significant
ethnic, linguistic, and other
social divisions within a
country
49
A
nation’s supply of usable
factors of production, including
mineral deposits, raw materials,
and labor
Resource endowment
50
Resource endowment
A
nation’s supply of usable
factors of production, including
mineral deposits, raw materials,
and labor
51
Facilities that
enable economic activity and
markets, such as transportation, communication and
distribution networks, utilities, water, sewer, and energy
supply systems.
Infrastructure
52
A market
in which the theoretical
assumptions of perfect competition are violated by the
existence of, for example, a
small number of buyers and
sellers, barriers to entry, and
incomplete information.
Incomplete information The
Imperfect market
53
The absence of information that
producers and consumers
need to make efficient decisions resulting in underperforming markets.
Incomplete information
54
Incomplete information
The absence of information that
producers and consumers
need to make efficient decisions resulting in underperforming markets.
55
The
acknowledged right to use
and benefit from a tangible
(e.g., land) or intangible (e.g., intellectual) entity that may
include owning, using, deriving income from, selling, and
disposing
Property rights
56
Property rights
The
acknowledged right to use
and benefit from a tangible
(e.g., land) or intangible (e.g., intellectual) entity that may
include owning, using, deriving income from, selling, and
disposing
57
The emigration of highly educated and skilled
professionals and technicians
from the developing countries
to the developed world.
Brain drain
58
Trade in which
goods can be imported and
exported without any barriers
in the forms of tariffs, quotas,
or other restrictions.
Free trade
59
Free trade
Trade in which goods can be imported and
exported without any barriers
in the forms of tariffs, quotas,
or other restrictions.
60
The ratio of a country’s average export price
to its average import price.
Terms of trade
61
Terms of trade
The ratio of a country’s average export price
to its average import price.
62
Scientific investigation with a view toward
improving the existing quality
of human life, products, profits, factors of production, or knowledge.
Research and development
(R&D)
63
Research and development
(R&D)
Scientific investigation with a view toward
improving the existing quality
of human life, products, profits, factors of production, or knowledge.
64
A tendency for per capita income (or
output) to grow faster in higher-income countries than in lower-income countries so
that the income gap widens
across countries over time (as
was seen in the two centuries
after industrialization began).
Divergence
65
Divergence
A tendency for per capita income (or
output) to grow faster in higher-income countries than in lower-income countries so
that the income gap widens
across countries over time (as
was seen in the two centuries
after industrialization began).
66
The tendency
for per capita income (or
output) to grow faster in
lower-income countries than
in higher-income countries so
that lower-income countries
are “catching up” over time.
When countries are hypothesized to converge not in all
cases but other things being
equal (particularly savings
rates, labor force growth, and
production technologies),
then the term conditional
convergence is used
Convergence
67
Convergence
The tendency
for per capita income (or
output) to grow faster in
lower-income countries than
in higher-income countries so
that lower-income countries
are “catching up” over time.
When countries are hypothesized to converge not in all
cases but other things being
equal (particularly savings
rates, labor force growth, and
production technologies),
then the term conditional
convergence is used
68
“Humanly devised” constraints that shape interactions (or “rules of the game”)
in an economy, including formal rules embodied in constitutions, laws, contracts, and market regulations, plus informal rules reflected in norms of behavior and conduct, values, customs, and generally accepted ways of
doing things
Economic Institutions
69
Economic Institutions
“Humanly devised” constraints that shape interactions (or “rules of the game”)
in an economy, including formal rules embodied in constitutions, laws, contracts, and market regulations, plus informal rules reflected in norms of behavior and conduct, values, customs, and generally accepted ways of
doing things
70
A theory of economic development,
associated with the American
economic historian Walt W.
Rostow, according to which
a country passes through
sequential stages in achieving
development.
Stages-of-growth model
of development
71
A functional economic relationship in which the growth
rate of gross domestic product
(g) depends directly on the
national net savings rate (s)
and inversely on the national
capital-output ratio (c).
Harrod-Domar growth model
72
Harrod-Domar growth model
A functional economic relationship in which the growth
rate of gross domestic product
(g) depends directly on the
national net savings rate (s)
and inversely on the national
capital-output ratio (c).
73
A ratio that shows the units of capital
required to produce a unit of
output over a given period
of time.
Capital-output ratio
74
Capital-output ratio
A ratio
that shows the units of capital
required to produce a unit of
output over a given period
of time.
75
Savings
expressed as a proportion of disposable income over some period of time.
Net savings ratio
76
Net savings ratio
Savings
expressed as a proportion of disposable income over some period of time.
77
condition that must be present,
although it need not be in
itself sufficient, for an event
to occur. For example, capital
formation may be a necessary
condition for sustained economic growth (before growth
in output can occur, there must
be tools to produce it). But for
this growth to continue, social,
institutional, and attitudinal
changes may have to occur.
Necessary condition
78
Necessary condition
condition that must be present,
although it need not be in
itself sufficient, for an event
to occur. For example, capital
formation may be a necessary
condition for sustained economic growth (before growth
in output can occur, there must
be tools to produce it). But for
this growth to continue, social,
institutional, and attitudinal
changes may have to occur.
79
A
condition that when present
causes or guarantees that an
event will or can occur; in
economic models, a condition
that logically requires that a
statement must be true (or a
result must hold) given other
assumptions.
Sufficient condition
80
Sufficient condition
A
condition that when present
causes or guarantees that an
event will or can occur; in
economic models, a condition
that logically requires that a
statement must be true (or a
result must hold) given other
assumptions.
81
The hypothesis that underdevelopment is due to underutilization of resources arising
from structural or institutional
factors that have their origins
in both domestic and international dualism. Development
therefore requires more than
just accelerated capital formation
Structural-change theory
82
Structural-change theory
The hypothesis that underdevelopment is due to underutilization of resources arising
from structural or institutional
factors that have their origins
in both domestic and international dualism. Development
therefore requires more than
just accelerated capital formation
83
The process of transforming
an economy in such a way that
the contribution to national
income by the manufacturing
sector eventually surpasses the
contribution by the agricultural
sector. More generally, a major
alteration in the industrial
composition of any economy
Structural transformation
84
Structural transformation
The process of transforming
an economy in such a way that
the contribution to national
income by the manufacturing
sector eventually surpasses the
contribution by the agricultural
sector. More generally, a major
alteration in the industrial
composition of any economy
85
A
theory of development in
which surplus labor from the
traditional agricultural sector
is transferred to the modern
industrial sector, the growth
of which absorbs the surplus
labor, promotes industrialization, and stimulates sustained development.
Lewis two-sector model
86
Lewis two-sector model
A
theory of development in
which surplus labor from the
traditional agricultural sector
is transferred to the modern
industrial sector, the growth
of which absorbs the surplus
labor, promotes industrialization, and stimulates sustained development.
87
The excess
supply of labor over and
above the quantity demanded
at the going free-market wage
rate. In the Lewis two-sector
model of economic development, surplus labor refers to
the portion of the rural labor
force whose marginal productivity is zero or negative.
Surplus labor
88
Surplus labor
The excess supply of labor over and
above the quantity demanded
at the going free-market wage
rate. In the Lewis two-sector
model of economic development, surplus labor refers to
the portion of the rural labor
force whose marginal productivity is zero or negative.
89
A technological or engineering relationship between the quantity
of a good produced and the
quantity of inputs required to
produce it.
Production function
90
Production function
A technological or engineering relationship between the quantity
of a good produced and the quantity of inputs required to
produce it.
91
Total output or product divided
by total factor input (e.g., the
average product of labor is
equal to total output divided
by the total amount of labor
used to produce that output).
Average product
92
Average product
Total output or product divided
by total factor input (e.g., the
average product of labor is
equal to total output divided
by the total amount of labor
used to produce that output).
93
The
increase in total output
resulting from the use of one
additional unit of a variable
factor of production (such as
labor or capital). In the Lewis
two-sector model, surplus labor
is defined as workers whose
marginal product is zero.
Marginal product
94
Economic growth that continues over the long run
based on saving, investment, and complementary private
and public activities.
Self-sustaining growth
95
Self-sustaining growth
Economic growth that continues over the long run
based on saving, investment, and complementary private
and public activities.
96
analysis An attempt to identify characteristic features of the internal process of structural transformation that a “typical” developing
economy undergoes as it generates and sustains modern economic growth and development.
Patterns-of-development
97
Patterns-of-development
analysis An attempt to identify characteristic features of the internal process of structural transformation that a “typical” developing
economy undergoes as it generates and sustains modern economic growth and development.
98
The
proposition that developing countries have failed to develop because their development strategies (usually given to them by Western economists) have been based
on an incorrect model of
development, one that, for example, overstresses capital
accumulation or market liberalization without giving due
consideration to needed social
and institutional change.
False-paradigm model
99
False-paradigm model
The
proposition that developing countries have failed to develop because their development strategies (usually given to them by Western economists) have been based
on an incorrect model of
development, one that, for example, overstresses capital
accumulation or market liberalization without giving due
consideration to needed social
and institutional change.
100
The coexistence of two situations or phenomena (one desirable and the other not) that are mutually exclusive to different groups of society—for
example, extreme poverty
and affluence, modern and traditional economic sectors, growth and stagnation, and
higher education among a few amid large-scale illiteracy
Dualism
101
Dualism
The coexistence of two situations or phenomena (one desirable and the other not) that are mutually exclusive to different groups of society—for
example, extreme poverty
and affluence, modern and traditional economic sectors, growth and stagnation, and
higher education among a few amid large-scale illiteracy
102
A closed economy
that attempts to be completely
self-reliant.
Autarky
103
Autarky
A closed economy
that attempts to be completely
self-reliant.
104
The 1980s resurgence of
neoclassical free-market orientation toward development
problems and policies, counter
to the interventionist dependence revolution of the 1970s.
Neoclassical counterrevolution
105
Neoclassical counterrevolution
The 1980s resurgence of
neoclassical free-market orientation toward development
problems and policies, counter
to the interventionist dependence revolution of the 1970s.
106
The system whereby prices of commodities or services freely rise or fall when the buyer’s
demand for them rises or falls or the seller’s supply of them decreases or increases.
Free markets
107
Free markets
The system whereby prices of commodities or services freely rise or fall when the buyer’s
demand for them rises or falls or the seller’s supply of them decreases or increases.
108
Theoretical analysis of the properties of an economic system operating with free markets,
often under the assumption that an unregulated market performs better than one with government regulation.
Free-market analysis
109
Free-market analysis
Theoretical analysis of the properties of an economic system operating with free markets,
often under the assumption that an unregulated market performs better than one with government regulation.
110
Growth model in which there are diminishing
returns to each factor of production but constant returns to scale. Exogenous technological change generates longterm economic growth.
Solow neoclassical growth
model
111
Solow neoclassical growth
model
Growth model in which there are diminishing
returns to each factor of production but constant returns to scale. Exogenous technological change generates longterm economic growth.
112
An
economy in which there are
no foreign trade transactions
or other economic contacts
with the rest of the world.
Closed economy
113
Closed economy
An
economy in which there are
no foreign trade transactions
or other economic contacts
with the rest of the world.
114
An economy that practices foreign trade
and has extensive financial
and nonfinancial contacts
with the rest of the world.
Open economy
115
Open economy
An economy
that practices foreign trade
and has extensive financial
and nonfinancial contacts
with the rest of the world.
116
A curve on a graph indicating alternative combinations of two commodities or categories of commodities (e.g., agricultural and manufactured goods) that can be produced when all the available factors
of production are efficiently employed. Given available resources and technology, the curve sets the boundary between the attainable and
the unobtainable.
Production possibility curve
117
Production possibility curve
A curve on a graph indicating alternative combinations of two commodities or categories of commodities (e.g., agricultural and manufactured goods) that can be produced when all the available factors
of production are efficiently employed. Given available resources and technology, the curve sets the boundary between the attainable and
the unobtainable.
118
Increased application of new scientific knowledge in the form of inventions and innovations with regard to both physical and human capital.
Technological progress
119
Technological progress
Increased application of new scientific knowledge in the form of inventions and innovations with regard to both physical and human capital.
120
A graph depicting the variance of the
size distribution of income from perfect equality
Lorenz curve
121
Lorenz curve
A graph depicting the variance of the
size distribution of income from perfect equality
