The international economy: growth & development Flashcards
(11 cards)
What is economic growth?
Economic growth refers to the increase in an economy’s total output of goods and services over time. It’s typically measured by the rise in real Gross Domestic Product (GDP
What is economic development?
Economic development is the sustainable increase in living standards for a country
What are main characteristics of LDEs?
- High rate of population growth (high birth rates, low life expectancy)
- High foreign debts
- Uneven distribution of wealth
- Over-dependence on one product (typically raw materials)
- Large primary sector
- Poor levels of education
- Poor living condition
What are main indicators of economic development?
- GDP per capita
- HDI
- GDP growth
- Unemployment
- Inflation
- Poverty
What are factors affecting economic growth & development?
- Investment
- Education & training
- Healthcare
What are barriers to economic growth & development?
- Corruption
- Institutional factors
- Poor infrastructure
- Inadequate human capiyal
- Lack of property rights
Policies to promote economic growth & development?
- Micro & macro policies
- Reducing capital flight via gov & central bank intervention
What is aid?
Money, goods and services, and ‘soft’ loans given by the government of one country or a multilateral institution like the world bank to help another country.
What is the role of aid in promoting growth and development?
What is the role of trade in promoting gorwth and development?
What is capital flight?
The sudden withdrawal of money from a country.
e.g a ruling elite within an economy moves the profit they make from the countries industires into foreign bank accounts, instead of reinvesting the profits in the country to further development.
