Test Bank - Economic Development 13th Edition By Michael Todaro |All Chapters 1-15 Covered| Complete Guide A+

TEST BANK
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Economic Development 13th Edition
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by Todaro, Chapter 1 to 15 Covered
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,Table of contents
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1 Introducing Economic Development:
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2 Comparative Economic Development
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3 Classic Theories of Economic Growth and Development
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4 Contemporary Models of Development and Underdevelopment
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5 Poverty, Inequality, and Development
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6 Population Growth and Economic Development:
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7 Urbanisation and Rural-Urban Migration:
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8 Human Capital:
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9 Agricultural Transformation and Rural Development
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10 The Environment and Development
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11 Development Policymaking and the Roles of Market, State, and Civil
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Society
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12 International Trade Theory and Development Strategy
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13 Balance of Payments, Debt, Financial Crises, and Sustainable
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Recovery: Cases and Policies
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14 Foreign Finance, Investment, Aid, and Conflict: Controversies and
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Opportunities
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15 Finance and Fiscal Policy for Development
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,Chapter 1: Introducing fg f g




fg EconomicDevelopment: A Global fg fg fg



fg Perspective
 Key Concepts fg




As curious as students who register to take Development Economics may be, their
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knowledge and experience of the developing world will vary widely. The first main point of
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Chapter 1 is to emphasise how different life in the developing world is. New in the 13th
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edition is a systematic description of four stylised strata of living standards from extreme
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poverty to rich based on Rosling,
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Rosling, and Rosling Ronnlund’s book Factfulness. This is followed by a discussion of the
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World Bank’s classification of economies by ranges of average national income using gross
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national income (GNI) statistics.
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The second point is to provide an overview of the nature of development economics as a
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field. A defense of development economics as a distinct field, rather than an
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agglomeration of other economics subfields, is offered. A major theme of the book, that
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development economics must encompass the study of institutional and social, as well as
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economic, mechanisms for modernising an economy while eliminating absolute poverty, is
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introduced.
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Sections 1.5 and 1.6 looks deeper into the meaning of development and a view of
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development that is multidimensional. Amartya Sen’s “Capabilities” approach is discussed in
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Section 1.5. In Section 1.6, data collected in a Gallup World Poll on the relationship between
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happiness (as measured by Gallup’s
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life satisfaction “ladder” question and real per capita income) and other research on
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happiness/life satisfaction is discussed. The level of happiness is not only related to level
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of income but to other factors such as democratic freedoms and the quality of social
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fgrelationships. The role of normative fg fg fg fg


values in development economics—a subject dealing with human misery and human
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potential, with equity as well as efficiency, with cultural change that causes losses as well as
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gains, and with transfer
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as well as creation of wealth—is also stressed.
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The conclusion is that development is both a physical reality and a state of mind. The
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meaning and objectives of development include the provision of basic needs, reducing
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inequality, raising living standards through appropriate economic growth, improving self-
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esteem in relation to the developed countries, and expanding freedom of choice in the
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market and beyond.
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Section 1.7 presents an in depth examination of the UN’s Sustainable Development Goals
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(SDGs). This includes a more comprehensive list of the goals themselves (appearing in
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Table 1.1) and a discussion of the shortcomings of the SDGs. In Section 1.8, the plan of
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the book is introduced through 32 critical questions of development economics.
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Depending on the amount of material
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covered by the instructor, students should be able to intelligently address most of these
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questions by the end of the course. Finally, a comparative case study of Pakistan and
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Bangladesh is presented.
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, Todaro fgand fgSmith, fgEconomic fgDevelopment, fg13e, fgInstructor’s
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 LectureSuggestions fg




It might be best to begin with a discussion of the immense scale of transformation in
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economy. The late Hans Rosling’s video “200 countries, 200 years, 4 minutes” (readily
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available on YouTube) can be used to confirm this point in an entertaining way. It might
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also be helpful to highlight that real gross world product per capita has almost tripled
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between 1960 and 2018 (implying growth per year of 1.85%) and is 33% higher
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than it was at the turn of this century
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(implying annual growth of 1.56% from 2000 to 2018). This data can be found on the
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Saint Louis Federal Reserve’s website in the Federal Reserve Economic Database (or FRED).
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Despite such advances, tremendous disparities continue to exist. In terms of easily
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accessible statistics the PEW Research Centre’s “World Population by Income”
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fgprovides an interactive map fg fg fg


showing the share of economies’ population who are economically poor, low income,
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middle income, upper middle income, and high income. While regrettably the data
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provided is for 2011, it
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echoes what Todaro and Smith point out in the text, that more than 75% of the world’s
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population live on $15 or less a day (or about $5,500 per person per year). Several
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excellent books attempt to give some idea of the range of living standards found
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throughout the world. For example, The Material World by Peter Menzell. This book
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presents photographic profiles of typical families
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around the world with all of their possessions placed in front of their homes. As one goes
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from one family to the next the instructor has the opportunity to highlight the important
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differences between nations and regions and to touch on key issues of growth and
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development.
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One of the key strengths of this chapter is that it does not focus solely on the hard
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fgnumbers that fg


supposedly measure development. The discussion of Sen’s Capabilities approach and the
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far less than perfect relationship between income and happiness are well worth spending
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a fair amount of class time exploring. Class time should also be spent discussing the
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fg32 critical questions listed on
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pages 21–23 of the text and then asking students to identify 3 or 4 questions that they
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f gare particularly interested in exploring. Asking each student to list what they consider to
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be “critically” critical questions on a sheet of paper, collecting their responses, and then
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trying to direct the rest of the term to addressing the most commonly mentioned critical
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questions for that class will be helpful
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in further drawing students in and holding their attention throughout the term.
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At this same point, the instructor might also wish to get some idea of students’
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experiences traveling to developing countries and, in as subtle a way as is possible,
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determine how shaky their understanding of the wider world is. The instructor perhaps
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could draw on his or her own experiences and give some background as to how he or
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she first became interested in Development
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Economics. This may – through the kinds of questions asked – help the instructor further
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gauge students’ level of sophistication in this area. This is not something that should be
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or, can, be settled in the first one or two classes and will develop over the course of the
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term.
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In many universities, the economic development course will be filled with students who are
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not majoring in economics. These students may come from different colleges with majors
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such as anthropology, sociology, or political science or business (management, finance,
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etc.). They may have had as little as one semester of introductory economics. Given that
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