Chapter 1. Setting the Stage: What Is Development?
What is development?
Types of development
o 1. Political
o 2. Social
o 3. Economic
Overall, development encompasses change, growth, progress, or some sort of evolution
of human condition
After WWI: meanings of development were focus on rebuilding economies in the
developed world as a way of preventing the rise of communism
Amartya Sen
o Expanded def of development, advocating a human-centred approach to development
o Freedom was crucial to development since it enhanced individuals’ well being
o Highlighted 5 basic freedoms
Political and participative freedoms
Economic opportunities
Social opportunities
Transparency guarantees
Protective security
o Development = the process of enlarging people’s choices
Inequality and development
World bank development indicators indicate
o Quality of life of citizens in the developing world is inferior to that of citizens in the
developed world
o Gap btwn women and men in terms of earning power, pol power and education: much
larger in the developing world
o Growth in developing world is very unevenly distributed
Dudley Seers
Hollis Chenery et al.
Inequality has major implications for both social and economic development
o 1. Countries w high levels of inequality have less stable and efficient economic systems,
which can stifle economic growth
One reason for this is that such countries have lower levels of aggregate demand,
which slows down economic growth
o 2. Inequality also perpetuates poverty traps
Slows pace of poverty reductions bc it limits opportunities for social mobility and
access to health care and education
, o 3. Inequality in health care can affect LT development
o 4. More prone to conflict
When distribution of land is uneven, which explains why inequalities persist (case in
many developing countries)
Inequality can decline by expanding education and by making public transfers to the
poor
Social inequalities
Feminization of poverty
o Women are more likely to die before the men in developing countries
o More likely to be malnourished than men
o Discrepancies in education
o Mostly concentrated in low-salary fields: gendered division of labour
o In aftermath of natural disaster, women are also more likely to suffer LT consequences
than men
Indigenous people are worse of than non-indigenous populations
Disabled people are also worse of than the general pop
Major shift occurred w the rise of sustainable development approaches
o By the 1980S, it became understood that development needs to be sustainable
o Development that can meet the needs of the present without compromising the ability
of the future to meet is own needs
o Result of growing awareness of global links btwn environmental problems, poverty,
ineq and well-being
o Recognizes that ecology and economy are interwoven locally, regionally, nationally and
globally
How is development measured?
Development indicators have evolved since the 1960s
o GDP growth was first used to measure development
GDP
o = total goods and services produced by a state in a given year
GDP per capita
o = GDP divided by a state’s total population
o Critized as measure for economic development bc it does not always offer a full picture
of a state’s developmental landscape
Purchasing power parity (PPP)
, o Calculating differences in the total cost of the same basic goods
Drawback of focusing on economic growth
o Reveals very little about societal distributions of wealth
o not reveal how economic gains or losses affect individual citizens
This is why some observers have turned to alternative indicators to capture quality of life
o Sen
Argues that development could not be based on GDP per capita bc it did not take into
account what an individual’s capabilities are
Influential in formulating the HDI
o Human Poverty Index
Goes beyond looking at growth rates
o Gender Development Index
Goes beyond looking at growth rates
HDI
o Takes into account many diff dimensions of development
o Prominent measure of development
o 3 dimensions
1. Health
2. Education
3. Living standards
Development is concerned with clear goals and targets
o Recently most common way to measure development is through the achievement of
the Millennium Development Goals (MDGs)
o = set of indicators and outcomes that can be measured and compared
o Critics
MDGs were created exclusively by industrialized countries without much consultation
Approach has been mostly top down
Gini index
o Measures inequality
o 0 has perfect inequality
o 100 is perfect equality
It is true that economic growth is not a panacea for a developing state’s problems
What is the role of global forces?
Rules are being dictated by international inst and MNCs
INGOs and intern donor agencies also have a significant impact on the developing world
, Bringing in the state
Hurdles to development
o Disease
o Instability
o Corruption
o …
State
o Max Weber = human community that successfully claims the monopoly of the
legitimate use of force within a given territory
o Statehood involves the legitimization of violence
o Concept of statehood emerged in 16th and 17th century w the Peace of Westphalia
Codified external sovereignty btwn pol entities
state institutions evolved out of the process of state formation, serving to help states
meet these criteria and provide security for their citizens and generate revenue
Most observers agree that the development of strong inst is critical for lifting states out
of poverty, and strengthening human capabilities
Scholars also notes that the state can play an important role in coordinating, steering
and persuading economic agents to accomplish things
o ‘It is the only agency capable of this task on a national basis’
o ‘only entity that has the structure and capacity to do so’
Joseph Stiglitz
o For economic develop to take place, technical solution focused on getting prices right
are not enough
o It is also necessary to strengthen the judicial inst in order to provide the legal
infrastructure and regulatory framework needed to encourage economic growth
o Economies need an institutional infrastructure in order to work
o YET states developing world often criticized for being part of problem not of solution
Focus on state inst can introduce chicken and egg problem
o Some studies address this endogeneity problem or loop of causality btwn 2 var of
interest, others do not
Need for inclusion and consensus building
Building inst in developing world is no easy task: there is not one size fits all solution
A roadmap
Chapter 2. Theories of Development: Why Are Some Countries
Underdeveloped?
What is development?
Types of development
o 1. Political
o 2. Social
o 3. Economic
Overall, development encompasses change, growth, progress, or some sort of evolution
of human condition
After WWI: meanings of development were focus on rebuilding economies in the
developed world as a way of preventing the rise of communism
Amartya Sen
o Expanded def of development, advocating a human-centred approach to development
o Freedom was crucial to development since it enhanced individuals’ well being
o Highlighted 5 basic freedoms
Political and participative freedoms
Economic opportunities
Social opportunities
Transparency guarantees
Protective security
o Development = the process of enlarging people’s choices
Inequality and development
World bank development indicators indicate
o Quality of life of citizens in the developing world is inferior to that of citizens in the
developed world
o Gap btwn women and men in terms of earning power, pol power and education: much
larger in the developing world
o Growth in developing world is very unevenly distributed
Dudley Seers
Hollis Chenery et al.
Inequality has major implications for both social and economic development
o 1. Countries w high levels of inequality have less stable and efficient economic systems,
which can stifle economic growth
One reason for this is that such countries have lower levels of aggregate demand,
which slows down economic growth
o 2. Inequality also perpetuates poverty traps
Slows pace of poverty reductions bc it limits opportunities for social mobility and
access to health care and education
, o 3. Inequality in health care can affect LT development
o 4. More prone to conflict
When distribution of land is uneven, which explains why inequalities persist (case in
many developing countries)
Inequality can decline by expanding education and by making public transfers to the
poor
Social inequalities
Feminization of poverty
o Women are more likely to die before the men in developing countries
o More likely to be malnourished than men
o Discrepancies in education
o Mostly concentrated in low-salary fields: gendered division of labour
o In aftermath of natural disaster, women are also more likely to suffer LT consequences
than men
Indigenous people are worse of than non-indigenous populations
Disabled people are also worse of than the general pop
Major shift occurred w the rise of sustainable development approaches
o By the 1980S, it became understood that development needs to be sustainable
o Development that can meet the needs of the present without compromising the ability
of the future to meet is own needs
o Result of growing awareness of global links btwn environmental problems, poverty,
ineq and well-being
o Recognizes that ecology and economy are interwoven locally, regionally, nationally and
globally
How is development measured?
Development indicators have evolved since the 1960s
o GDP growth was first used to measure development
GDP
o = total goods and services produced by a state in a given year
GDP per capita
o = GDP divided by a state’s total population
o Critized as measure for economic development bc it does not always offer a full picture
of a state’s developmental landscape
Purchasing power parity (PPP)
, o Calculating differences in the total cost of the same basic goods
Drawback of focusing on economic growth
o Reveals very little about societal distributions of wealth
o not reveal how economic gains or losses affect individual citizens
This is why some observers have turned to alternative indicators to capture quality of life
o Sen
Argues that development could not be based on GDP per capita bc it did not take into
account what an individual’s capabilities are
Influential in formulating the HDI
o Human Poverty Index
Goes beyond looking at growth rates
o Gender Development Index
Goes beyond looking at growth rates
HDI
o Takes into account many diff dimensions of development
o Prominent measure of development
o 3 dimensions
1. Health
2. Education
3. Living standards
Development is concerned with clear goals and targets
o Recently most common way to measure development is through the achievement of
the Millennium Development Goals (MDGs)
o = set of indicators and outcomes that can be measured and compared
o Critics
MDGs were created exclusively by industrialized countries without much consultation
Approach has been mostly top down
Gini index
o Measures inequality
o 0 has perfect inequality
o 100 is perfect equality
It is true that economic growth is not a panacea for a developing state’s problems
What is the role of global forces?
Rules are being dictated by international inst and MNCs
INGOs and intern donor agencies also have a significant impact on the developing world
, Bringing in the state
Hurdles to development
o Disease
o Instability
o Corruption
o …
State
o Max Weber = human community that successfully claims the monopoly of the
legitimate use of force within a given territory
o Statehood involves the legitimization of violence
o Concept of statehood emerged in 16th and 17th century w the Peace of Westphalia
Codified external sovereignty btwn pol entities
state institutions evolved out of the process of state formation, serving to help states
meet these criteria and provide security for their citizens and generate revenue
Most observers agree that the development of strong inst is critical for lifting states out
of poverty, and strengthening human capabilities
Scholars also notes that the state can play an important role in coordinating, steering
and persuading economic agents to accomplish things
o ‘It is the only agency capable of this task on a national basis’
o ‘only entity that has the structure and capacity to do so’
Joseph Stiglitz
o For economic develop to take place, technical solution focused on getting prices right
are not enough
o It is also necessary to strengthen the judicial inst in order to provide the legal
infrastructure and regulatory framework needed to encourage economic growth
o Economies need an institutional infrastructure in order to work
o YET states developing world often criticized for being part of problem not of solution
Focus on state inst can introduce chicken and egg problem
o Some studies address this endogeneity problem or loop of causality btwn 2 var of
interest, others do not
Need for inclusion and consensus building
Building inst in developing world is no easy task: there is not one size fits all solution
A roadmap
Chapter 2. Theories of Development: Why Are Some Countries
Underdeveloped?
