Measuring Economic Development

1. Measuring Economic
Development
Chapter 1
Economic Elective

2. GNP Gross
National
Product
The measure of a country’s
wealth – the value of goods
and services produced in a
country plus those produced
by native companies located
abroad.
GDP Gross
Domestic
Product
The value of all goods and
services produced (by locally
owned and foreign owned
businesses) in a country.
HDI Human
Development
Index
Measure of people’s life
expectancy, education and
income.
TERMS YOU NEED TO UNDERSTAND

3. LDC Least
Developed
Country
Formerly known as a Third
World country – a country is
that is poorer than other
countries, e.g. Ethiopia.
NIC Newly
Industrialised
Country
A country experiencing rapid
economic development, e.g.
Brazil.
HIPC Highly
Indebted
Poor Country
Countries with the highest
levels of poverty in the world,
e.g. Ethiopia.
TERMS YOU NEED TO UNDERSTAND

4. World Patterns in Economic
Development
Type of Region Examples
1 Developed
Region
Europe, North America, Japan, Australia.
2 Quickly
Developing
Countries
South East Asian countries: China, India,
South and Central America: Brazil, Mexico
North African countries: Egypt
3 Least Developed
Countries
Many African countries: Zambia, Ethiopia
Some countries in Asia: Bangladesh

5. Developed Regions
• High levels of industrial activity
• Well developed healthcare
systems
• Educated population
• Equality between men and women
• Child mortality is low
• Well developed infrastructure
(hospitals, schools, etc).

6. Quickly Developing Countries
• Industrialised rapidly over the last 20 years
• Most jobs are in manufacturing and services
• Wages are low – this attracts MNCs looking for cheap
labour
• Healthcare and literacy levels are improving

7. Least Developed Countries
• Poorest in the world.
• Life Expectancy low.
• Millions live in poverty.
• Disease is common.
• Government is absent or corrupt.
• Many girls receive no education.
• Most jobs are low income primary industry jobs.

8. Least Developed Countries

9. Measures of Economic Development
1 Gross National Product
2 Human Development Index

10. Indicator Advantages Disadvantages
GNP  Easy to see ranked position
of a country in a list.
 Gives a quick view of level of
development.
 Easy to calculate from
government statistics.
 Average figure – hides the
inequality of wealth.
 Presence of MNCs can give a
high GNP covering up poor
performance by local
companies.
 Doesn’t account for black
market.
HDI  Includes several social and
economic conditions in a
country.
 A more complete view of
development.
 Inequality can still exist in a
country with a high score.
 Cannot easily measure
changes in long term
indicators such as life
expectancy.

11. Homework
All students: Revise and understand new terms page 8
Higher Level
1. 2011 Q 9A (HDI)
2. 2010 Q 8A (HDI)
3. 2008 Q 8A (HDI)
4. 2007 Q 7A (GDP)
5. 2006 Q 7A (GDP)
Ordinary Level
• Page 18
Questions 11 &
12.