The Concept of Development

Meaning of Development
Traditional Economic Meaning:
Development is the CAPACITY of the national economy, whose initial economic
condition has been more or less static for a long time, to GENERATE and
SUSTAIN an annual increase in its GROSS NATIONAL PRODUCT at rates of
5% to 7%.
There is s stress on the industrialization often at the expense of agriculture and
rural development.
Development is seen as an economic phenomena in which rapid gains in overall
growth would either trickle down to the masses in the form of jobs and other
economic opportunities.
NEW ECONOMIC VIEW
Development is the reduction or the elimination of poverty, inequality and
unemployment within the context of a growing economy.
The development of the PEOPLE rather than development of things.
The challenge of development is to IMPROVE the quality of life. Especially in
the worlds poor countries.
Development means less poverty, cleaner environment, more equal opportunity,
greater individual freedom and a richer cultural life.
Therefore: DEVELOPMENT must be conceived of as a MUTIDIMENSIONAL
PROCESS.
DEVELOPMENT must involve major changes in social structures, popular
attitudes and national institutions as well as acceleration of economic growth, the
reduction of inequality and the eradication of poverty.
DEVELOPMENT must represent the WHOLE GAMUT of CHANGE by which an
entire social system turned to the diverse basic needs and desires of individuals
and social groups within that system, moves away from a condition of life widely
perceived as unsatisfactory toward a situation or condition of life regarded as
materially and spiritually better.

3 CORE VALUES OF DEVELOPMENT

1. SUSTENANCE: The ability to meet basic needs
When life sustaining basic human needs like food, shelter, health and
protection are absent UNDERDEVELOPMENT exists.
One clearly has to have enough in order to be more.
Purpose of Development is to create an environment in which all people
can expand their capabilities and opportunities can be enlarged for both the
present and future generations.
Real foundation of human development is UNIVERSALISM in
acknowledging the life claims of everyone.
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2. SELF-ESTEEM: To be a person
Self-esteem is having a sense of worth and self-respect, of not being used
as a tool by others for their own needs.
All people and societies seek some basic form of self-esteem although
they may call it authenticity, identify, dignity, respect, honor or recognition.
As long as self-esteem or respect was dispensed on the grounds other
than material achievement, it was possible to resign oneself to poverty without
feeling disdained.
Once the prevailing image of better life includes material welfare as one of
essential ingredients it becomes difficult for the materially underdeveloped to feel
respected or esteemed.
NOWADAYS, the THIRD WORLD seeks development in order to gain
ESTEEM which is denied to societies living in a disgraceful underdevelopment.
DEVELOPMENT is legitimized as a goal because it is an important
perhaps even indispensable way of GAINING ESTEEM.
3. FREEDOM FROM SERVITUDE: To be able to choose
FREEDOM is to be understood in the sense of EMANCIPATION from
alienating material conditions of life and from social servitude to nature,
ignorance, other people, misery, institutions and dogmatic beliefs.
The ADVANTAGE of economic growth is NOT that wealth increases
happiness but that it increases range of human choice.
It allows people freedom to choose greater leisure or to have more goods
and services.
OBJECTIVES OF DEVELOPMENT
To increase the vailability and widen the distribution of basic life-sustaining
goods such as food, shelter, health and protection.
To raise levels of living including in addition to higher incomes, the provision of
more jobs, better education and greater attention to cultural and humanistic
values, all of which will serve not only to enhance material well-being but also to
generate greater individual and national self-esteem.
To expand the range of economic and social choices available to individuals
and nations by freeing them from servitude and dependence not only in relation
to other people and nation states but also to the forces of ignorance and human
misery.
THEORIES OF DEVELOPMENT
Introduction
Every nation strives after development. Economic progress is an essential
component but is not the only component. In an ultimate sense, it must
encompass more than material and financial side of peoples lives. Development
is not purely an economic phenomenon. It should be perceived as a
multidimensional process involving the reorganization and reorientation of
economic and social systems. It must involve radical changes in institutional,
social and administrative structures. Its widespread realization may necessitate
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fundamental modification of the international economic and social system as

well.
THEORIES OF DEVELOPMENT:
1. Linear Stage Theory
a. Rostows Stage of Growth Model
b. Harrod-Domar Growth Model
2. Structural Changes Model
a. Lewis Theory of Development
3. International-Dependence Theory
a. Neocolonial Dependence Model
b. False Paradigm Model
c. Dualistic Development Model
4. Neoclassical Counterrevolution Theory
a. Free Market Analysis Model
b. Public Choice Model
c. Market-Friendly Model
5. New Growth Theory

Theories of Development
1. Linear Stage Theory
Puts a heavy emphasis on logic and simplicity of two strands of thought
the UTILITY OF MASSIVE INJECTIONS OF CAPITAL and the
HISTORIAL PATTERN of the now developed countries.
a. Rostows Stage of Growth Model
Out of this intellectual environment, fueled by cold war politics in the
1950s and 1960s and the resulting competition for the allegiance of
newly independent nations, came the stage-of growth model of
development
Its most outspoken advocate was the American Economic historian
Walt W. Rostow.
The transition from underdevelopment to development can be
described in terms of series of steps or stages through which all
countries must proceed. It is possible to identify all societies, in their
economic dimensions as lying within one of the five categories:
Traditional Society
Pre-conditions for take-off into self-sustaining growth
The Take-off
The Drive to Maturity
Age of High Mass Consumption
It was argued that the advanced countries had all passed the stage of
take-off into self-sustaining growth and the underdeveloped countries
that were still in either the traditional society or the preconditions stage
had only to follow a certain set of rules of development to takeoff in
their turn into self-sustaining economic growth.

One of the principal tricks of development necessary for any take-off

was the mobilization of domestic and foreign saving in order to
generate sufficient investment to accelerate growth.
b. Harrod-Domar Growth Model
Every economy must save certain proportion of its national income if
only to replace worn-out or impaired capital goods like buildings and
equipment. In order to grow, new investments representing net
additions to the capital stock are necessary.
If we assume that there is some direct economic relationship between
the size of total capital stock (K) and total GNP (Y), it follows that any
net additions to the capital stock in the form of new investment will
bring about corresponding increases in the flow of national output,
GNP.
The model therefore is simple:
Saving (S) is some proportion (s) of national income (Y)
S = sY
Investment (I) is defined as the change in the capital stock (K)
I = K
But because the total capital stock (K) bears direct relationship to the
total national income or output (Y) as expressed by the capital-output
ratio, (k) it follows that:
K=k
Y

or

K = k
Y

or

K = kY

Total national savings (S) must equal total investment (I)

S = I
And since we know that S = sY and that I = K = kY, it therefore
follows that:
S= sY =kY = K = I or simply as sY = kY
Dividing both sides of equation by Y and then by k, we obtain the
following expression:
Y
Y

= s
k

The above equation is the simplified version of the famous equation in

Harrod-Domar theory of economic growth, states simple that the rate
of growth of GNP is determined jointly by the national savings
ration, s, and the national capital-output ration k,
In the absence of government, the growth rate of national income will
be positively or directly related to the savings and inversely to the
economys capital-output ratio. The economic logic of the equation is
simple, in order to grow, economies must save and invest a certain
proportion of their GNP. The more they can save and invest, the
faster they can grow.

II. Structural Changes Model It focuses on the mechanism by which

underdeveloped economies transform their domestic economic structures
from a heavy emphasis on tradition subsistence agriculture to a modern,
more urbanized and more industrially diverse manufacturing and service
economy. It employs the tools of neoclassical price and resource allocation
theory and modern econometrics to describe how this transformation process
takes place.
Development is an identifiable process of growth and change whose main
feature are similar in all countries.
Factors influencing the development process include a countrys resource
endowment and size, its governments policies and objectives, the availability
of external capital and technology and international trade environment.
Structural change economists argue that one can identify certain patterns
occurring in almost all countries during the development process.
These patterns may be affected by the choice of development policies
pursued by the LDC governments as well as the international trade and
foreign-assistance policies of developed nations. Hence, such analysts are
optimistic that the correct mix of economic policies will generate beneficial
patterns of self-sustaining growth.
a. Lewis Theory of Development
The primary focus of the model is on both the process of labor
transfer and growth of output and employment in the modern sector. Both
labor transfer and modern-sector employment growth are brought about by
output expansion in that sector. The speed with which this expansion occurs is
determined by the rate of industrial investment and capital accumulation in the
modern sector.
Such investment is made possible by the excess of modern-sector profits over
wages on the assumption that capitalists reinvest all their profits. Finally, the level
of wages in the urban industrial sector is assumed to be constant and determined
as a given premium over a fixed average subsistence level of wages in the
traditional agricultural sector.

3. International-Dependence Theory
During the 1970s, international-dependence models gained increasing
support especially among Third World intellectuals as a result of growing
disenchantment with both the stages and structural-changes model.
These models view developing countries as beset by institutional,
political and economic rigidities both domestic and international and
caught up in a dependence and dominance relationship with rich
countries.

a. Neocolonial Dependence Model

This is an indirect outgrowth of the Marxist thinking which attributes
the existence and continuance of underdevelopment primarily to
the historical evolution of a highly unequal international capitalist
system of rich country-poor country relationships.

The coexistence of rich and poor nations in an international system

dominated by such unequal power relationships between the CENTER
(developed countries) and the PERIPHERY (less developed countries)
renders attempts by poor nations to be self-reliant and independent
difficult and sometimes even impossible.
Certain groups in the developing countries who enjoy high
incomes, social status and political power is in perpetuation of the
international capitalist system of inequality and conformity by which
they are rewarded.
The elites viewpoints and activities serve to inhibit any genuine reform
efforts that might benefit the wider population and actually lead to even
lower levels of living and perpetuation of UNDERDEVELOPMENT
Neocolonial View of underdevelopment attributes a large part of the
3rd Worlds continuing and worsening poverty to the existence and
policies of the industrialist capitalist countries of the Northern
Hemisphere and their extensions in the form of small but powerful
elites in the less developed countries.
UNDERDEVELOPMENT is seen as an externally induced
phenomenon, revolutionary struggles or restructuring the world
capitalist system are required to free dependent 3 rd World nations from
direct and indirect economic control of the 1 st World and domestic
oppressors.
One of the most forceful statements of the international-dependence
school of thought was made by Theotonio Dos Santos:
UNDERDEVELOPMENT, far from constituting a state of
backwardness prior to capitalism is rather a consequence and a
particular from of capitalist development known as dependent
capitalism. DEPENDENCE is a conditioning situation in which the
economies of one group of countries are conditioned by the
development and expansion of others.
Dominant countries are endowed with technological, commercial,
capital and socio-political predominance over dependent countries
the form of this predominance varying according to the particular
historical moment and can therefore exploit them and extract part of
the locally produced surplus. DEPENDENCE then is based upon an
international division of labor which allows industrial
development to take place in some countries while restricting it in
others whose growth is conditioned by and subjected to the
power centers of the world.
b. False Paradigm Model
Attributes underdevelopment to faulty and inappropriate advice
provided by well-meaning but often uninformed, biased and
ethnocentric international expert advisers from developedcountry assistance agencies and multinational donor organizations.

These experts offer sophisticated

concepts, elegant theoretical
structures and complex econometric models of development that often
lead to inappropriate or incorrect policies.
Having little or no really useful knowledge to enable them to come up
to grips in effective way with real development problems, they often
tend to become unknowing or reluctant apologists for the existing
system of elitist policies and institutional structures.
c. Dualistic Development Model
Notion of a world of dual societies, of rich nations and poor nations and in
developing countries, pockets of wealth within broad areas of poverty.
DUALISM is a concept which represents the existence and persistence of
increasing divergences between rich and poor nations and rich and poor
peoples on various levels.
ELEMENTS:
1.Different sets of conditions of which some are superior and other inferior,
can coexist in a given space.
2. Coexistence is chronic and not merely transitional.
3. Degrees of inferiority or superiority have inherent tendency to increase.
4. Existence of superior elements does little or nothing to pull up the inferior
elements, let alone trickle down to it.
IV.

Neoclassical Counterrevolution Theory

This theory favors in developed nations supply-side macroeconomic
policies, rational expectations theories and the privatization of public
corporations.
In developing countries it called fore freer markets and the dismantling
of public ownership, statist planning and government regulation of
economic activities.
The central argument of this theory is that underdevelopment
results from poor resource allocation due to incorrect pricing
policies and too much state intervention by overly active Third
World governments.
It is the very state intervention in economic activity that slows the
pace of economic growth. By permitting competitive free markets to
flourish, privatizing state-owned enterprises, promoting free trade and
export expansion, welcoming investors from developed countries and
eliminating the plethora of government regulations and price distortions
in factor, product and financial markets both economic efficiency and
economic growth will be stimulated.
Third World countries are underdeveloped not because of the
predatory activities of the First World countries and the international
agencies that it controls but rather because of the heavy hand of the
state and the corruption, inefficiency and lack of economic
incentives that permeate the economies of developing nations.
a. Free Market Analysis Model
This model argues that markets alone are efficient. Product
markets provide the best signals for investments in new
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activities, labor markets respond to these new industries in

appropriate ways, producers know best what to produce and
how to produce it efficiently and the product and factor prices
reflect accurate scarcity values of goods and resources now
and in the future. Competition is effective, if not perfect,
technology is freely available and costless to absorb, information is
also perfect and costless to obtain. Any government intervention is
by definition distortionary and counterproductive. Third world
markets are efficient and that whatever imperfection exist are of
little consequence
b. Public Choice Model
This is also know as the New Political economy Approach which
argues that governments can do nothing right. This is because this
model assumes that bureaucrats, politicians, citizens and states
act solely from self-interested perspective using their power
and the authority of the government for their own selfish ends.
c. Market-Friendly Model
This is associated primarily with the writings of the World bank and
its economists many of whom were more in the free-market and
public choice camps in the 1980s.
This approach recognizes that there are many imperfections in
the LDC product and factor markets and that governments do
have a key role to play in facilitating the operation of markets
through nonselective interventions like investing in physical and
social infrastructure, health care facilities and educational
institutions and by providing suitable climate for private enterprise.
Market failures are more widespread in developing countries in
areas such as investment coordination and environmental
outcomes.
V.

New Growth Theory

The poor performance of neoclassical theories in illuminating the
sources of long term economic growth has led to a general
dissatisfaction with traditional theory.
According to traditional theory, there is no intrinsic characteristic of
economies that causes them to grow over extended periods of
time. It is concerned with the dynamic process through which
capital-labor ratios approach long-run equilibrium levels.
In the absence of technological change, all economies will
converge to zero growth.
Rising per capita GNP is considered a contemporary phenomenon
resulting from a change in technology or a short-term equilibrating
process in which an economy approaches its long-run equilibrium.

FACTORS OF ECONOMIC GROWTH

1. CAPITAL ACCUMULATION
2. GROWTH IN POPULATION
3. TECHNOLOGICAL PROGRESS
a. Neutral Technological Progress
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b. Capital-Saving Technological Progress

c. Labor Saving Technological Progress
FACTORS OF ECONOMIC GROWTH
1. CAPITAL ACCUMULATION including all new investments in land,
equipment and human resources
Capital accumulation results when some proportion of present
income is saved and invested in order to augment future output and income.
New factories, machinery, equipment and materials increase the physical
capital stock of a nation and make it possible for expanded output levels to be
achieved.
1. GROWTH IN POPULATION and hence eventual growth in labor force
Population growth has traditionally been considered a positive factor in
stimulating economic growth. A larger labor force means productive
workers and a large overall population increases the potential size of
domestic markets.
However, it is questionable whether rapidly growing supplies of workers in
surplus-labor developing countries exert a positive or negative influence
on economic progress. It will depend on the ability of the economic system
to absorb and productively employ these added workers an ability
largely associated with the rate and kind of capital accumulation and the
availability of related factors like managerial and administrative skills.
2. TECHNOLOGICAL PROGRESS
Technological progress results from new and improved ways of
accomplishing traditional tasks like building a house or growing crops.
There are three basic classifications of technological progress;
a. NEUTRAL TECHNOLOGICAL PROGRESS
This occurs when higher output levels are achieved with the same
quantity and combinations of factor inputs. Simple innovations like those
that arise from the division of labor can result in higher total output levels
and grater consumption for all individuals.
b. CAPITAL-SAVING TECHNOLOGICAL PROGRESS
Almost all of the worlds scientific and technological research is
conducted in developed countries where the mandate is to save labor not
capital. In capital scarce industries, capital-saving technological progress
is what is needed most. Such progress results in more efficient labor
intensive methods of production.
c. LABOR SAVING TECHNOLOGICAL PROGRESS
This occurs when the quality or skills of the labor force are
upgraded by use of videotapes, televisions and other electronic
communications media for classroom instruction.
CHARACTERISTICS OF MODERN ECONOMIC GROWTH
1. High rates of growth per capita output and population
2. High rates of increase in total factor productivity
3. High rates of structural transformation of the economy
4. High rates of social and ideological transformation
5. The propensity of economically developed countries to reach out to the rest of
the world for markets and raw materials

6. The limited spread of this economic growth to only a third of the worlds
population
TO SUMMARIZE the 6 characteristics:
1. The sustained rise in national output is a manifestation of economic growth
and the ability to provide a wide range of goods is a sign of economic maturity.
2. Advancing technology provides the basis for preconditions for continuous
economic growth- a necessary but not sufficient condition
3. To realize potential growth inherent in new technology, institutional,
attitudinal and ideological adjustments must be made. Technological
innovation without concomitant social innovation is like a light bulb without
electricity the potential exists but without the complementary input, nothing will
happen.
Modernization Ideals accdg. To Gunnar Myrdal for underdevelopment in
Asia
a. RATIONALITY the substitution of modern methods of thinking, acting,
producing, distributing and consuming for age-old, traditional practices. What
underdeveloped nations need is a scientific and technological society. It employs
new techniques whether in the farm, in the factory or in transport. Modern
techniques are not just a matter of getting a tool and using it. The quest for
rationality implies that opinions about economic policies should be logically valid
inferences rooted as deeply as possible in knowledge of relevant facts.
b. ECONOMIC PLANNING the search for rationally coordinated system of
policy measures that can bring about and accelerate economic growth and
development
c. SOCIAL AND ECONOMIC EQUALIZATION the promotion of more equality
in status, opportunities, wealth, incomes and levels of living
d. IMPROVED INSTITUTIONS AND ATTITUDES necessary to increase labor
efficiency and diligence, promote effective competition, social and economic
mobility and individual enterprise, permit greater equality of opportunities, make
possible higher productivity, raise levels of living and promote development.
Among the social institutions needing change are outmoded land tenure
systems, social and economic monopolies, educational and religious structures
and systems of administration and planning. In the area of attitudes, the concept
of modern workers embodies such ideals as efficiency, diligence, orderliness,
punctuality, frugality, honesty, rationality, change orientation, integrity and selfreliance, cooperation and willingness to take the long view.
Classifying different countries in the context of development
In attempting to classify some countries, some analysts using the United
Nations classification system prefer to distinguish among three groups within the
Third World:

LEAST DEVELOPED pertaining to the 44 POOREST countries

DEVELOPING pertaining to 88 non-oil exporting countries
DEVELOPED pertaining to the 13 petroleum rich members of OPEC
Others follow the classification established by the International Bank for
Reconstruction and Development (IBRD) more commonly known as
World Bank:

10

LOW-INCOME countries (per capita GNP less than $785)

MIDDLE-INCOME countries (per capita GNP $786 - $3,125)
UPPER MIDDLE INCOME countries (per capita GNP $3,126-$9,655)
HIGH INCOME ECONOMIES (per capita GNP of $9,655 or more)

The most recent classification comes from the United Nations Development
Program (UNDP). It focuses on the aspects of HUMAN DEVELOPMENT that go
beyond the income to include such non-economic variables as life expectancy at
birth and educational attainment along with real per capita income. It then
constructs a HUMAN DEVELOPMENT INDEX (HDI) in which 174 countries are
ranked into three human development aggregates:

HIGH pertaining to 64 countries including several LDCs

MEDIUM 65 countries
LOW 45 countries

Another classification is that made by the Organization for Economic

Cooperation and Development (OECD) in Paris. It divides the third world into:

61 LOW INCOME countries (per capita income of less than $650 including
29 LDCs)
73 MIDDLE INCOME countries
11 NEW INDUSTRIALIZING COUNTRIES
13 MEMBERS of the OPEC

STRUCTURAL DIFFERENCES OF DEVELOPING ECONOMIES

A. The size of the country which includes geographic area, population and
income
B. Its historical and colonial background
C. Its endowments of physical and human resources
D. Its ethnic and religious composition
E. The relative importance of its public and private sectors
F. The nature of its industrial structure
G. Its degree of dependence on external economic and political forces
H. The distribution of power and the institutional and political structure within
the nation
COMMON CHARACTTERISTICS OF DEVELOPING NATIONS

Low levels of living characterized by low incomes, inequality, poor health

and inadequate education
Low levels of productivity
High rates of population growth and dependency burdens
High and rising levels of unemployment and underemployment
Susbtantial dependence on agricultural production and primary-product
exports
Prevalence of imperfect markets and limited information
Dominance, dependence and vulnerability in international relations
The State of Underdevelopment

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Unequal distribution of assets, skewed distribution of income and

employment opportunities amongst citizens, inequality in access to social
services, high level of illiteracy and social backwardness.

Segregated planning approaches and scattered residential and farming

settlements without viable economic and social linkages to the more
economically active areas of the country.

Under utilisation and/or unsustainable use of natural

Poor or lack of access to socio-economic infrastructure and services,

public amenities and government services (e.g. industrial parks lying idle
especially in the former homeland areas)

Lack of access to water or lack of water sources for both household and
agricultural development

Low literacy, skills levels and migratory labour practices

Decay of the social fabric (child-headed households, crime, family

disputes and lack of Ubuntu)

Death of cultural progress

Unresolved restitution and land tenure issues

Townships not formally established thus hindering service provision and

development

Dependence on social grants and other forms of social security

Unexploited opportunities in agriculture, tourism, mining and

manufacturing

resources

The contrast between what great things human beings can achieve and what
limited lives most women and men end up living is truly remarkable.
- Amartya Sen
People are the real wealth of nations.
The objective of development is to create an enabling environment for people to
enjoy long, healthy and creative lives.
- Mahbub ul Haq
2010: Human development
"Human development is the expansion of peoples freedoms to live long,
healthy and creative lives; to advance other goals they have reason to value; and
to engage actively in shaping development equitably and sustainably on a
shared planet. People are both the beneficiaries and drivers of human
development, as individuals and in groups.
HUMAN DEVELOPMENT INDEX (HDI)

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Measuring Human Development

The origins : GDP vs HDI

The HDI is an index just as vulgar as GDP but it stands for better
things (Amartya Sen)
HDI aggregates health education and income
GDP/HDI:
commodity-centred vs human-centred
Indicators need to be: relevant, internationally comparable,
available for many countries
Neglected dimensions: gender, equity, sustainability...
Inequality-adjusted Human Development Index (IHDI)

Gender Inequality Index (GII)

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Multidimensional Poverty Index (MPI)

HD Indices Sources
HDI

IHDI

HDI

IHDI

Life expectancy: UNDESA World Population Prospects

Years of Schooling: UNESCO Institute for Statistics and Barro and Lee
(2010) [NBER working paper 15902]
GNI PPP per capita: World Banks World Development Indicators
Life expectancy: UNDESA World Population Prospects
Years of Schooling: household survey data in international databases
(EUSILC, UNICEF-MICS, USAID-DHS, WHO-WHS)
Household income or consumption: household survey data in international
databases (Luxemburg Income Study, EUSILC, UNICEF-MICS, USAIDDHS, World Banks International Income Distribution Database, United
Nations Universitys Income Inequality Database)
Life expectancy: UNDESA World Population Prospects
Years of Schooling: UNESCO Institute for Statistics and Barro and Lee
(2010) [NBER working paper 15902]
GNI PPP per capita: World Banks World Development Indicators
Life expectancy: UNDESA World Population Prospects
Years of Schooling: household survey data in international databases
(EUSILC, UNICEF-MICS, USAID-DHS, WHO-WHS)
Household income or consumption: household survey data in international
databases (Luxemburg Income Study, EUSILC, UNICEF-MICS, USAID-

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DHS, World Banks International Income Distribution Database, United

Nations Universitys Income Inequality Database)
2. Contribution to the development debate
Global Reports 1990-2010
HDR 90 - Concept and Measurement
HDR 91 - Financing
HDR 92 - Global Dimensions
HDR 93 - Peoples Participation
HDR 94 - Human Security
HDR 95 - Gender
HDR 96 - Economic Growth
HDR 97 - Eradicate Poverty
HDR 98 - Consumption
HDR 99 - Globalization
HDR 00 - Human Rights
HDR 01 - New technologies
HDR 02 - Democracy
HDR 03 - MDGs
HDR 04 - Cultural Liberty
HDR 05 - Aid, trade and security
HDR 06 - Water
HDR 07/08 - Climate Change
HDR 09 - Migration
HDR 10 - Pathways to HD
HDR 11 - Sustaining equitable
progress

HDR Impact: News and academic citations

HDR continues to outperform its closest competitor (the World Banks

annual World Development Report) by almost 2:1
The HDI is a key contributor to that success.
In academic citations, the HDR recently overtook the WDR.
In 2010, HDRs academic citations = 4,090, compared to the
WDRs 2,790
Widespread endorsement from policy and academic circles
One of the worlds most significant documents. Gregg
Easterbrook, The New Republic
Substantially enriches our understanding of the development
landscape. Dani Rodrik, Harvard
Regional, National and Sub-national Reports: More than just Reports
Since 1992, more than 600 National and Sub-national HDRs, as well
as 30 Regional Reports, have been produced in more then 130
countries.

Inspired by the global HDR

Tool to tailor development strategies to local realities
Seeing people as the nations wealth, end and means of advancing the
development agenda
Provide new research and disaggregated data
Offer innovation in concept, measurement, and policy
Focus on equity, efficiency, empowerment, and sustainability in policies
and the HDR process itself

NHDR Influence

15

Inclusive: youth involvement in each stage of the HDR preparation

process
Thorough analysis: focus on 5 million youth out of education and
employment
Relevance: more than 1,000 news reports, articles and interviews
Influence: youth policy and youth NGOs coalition

The importance of an inclusive process

216 events to gauge opinions and gather voices, proposals and

commitments
4,369 people throughout the different territories: community members,
local leaders, civil servants, government representatives, academics,
businessmen and women, workers, country workers and farmers,
displaced people, the disabled, those reinserted into society, women and
the elderly, young people, homosexuals, indigenous people and people of
African descent.

Measurement Innovation

Disaggregation (e.g. Roma MDGs)

Comparing subjective and objective data (e.g. human security perceptions
in Latvia)
Qualitative analysis of quantitative data (e.g. Cambodia - the financial
returns to education are higher for women)
Measuring deprivations in the country-context (e.g. social inclusion indices
in BiH)
New indices covering more dimensions (e.g. Dominican Republic on
individual and collective empowerment)

North and South Divide

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1981 The West German Chancellor Willy Brandt produced the Brandt
report. The report identified The Development Gap
BUT the picture has changed considerably since, with many countries
such as Brazil, India and China are developing rapidly.
Accdg. to Brandt:

The North possess 80% of the worlds wealth

The South only 20%

Positives of Map:
Simplifies data so that it's easy to understand.
GDP is used which is an easy to access data source.
Negatives of Map:
Doesn't include some countries which are more economically developed.
Generalised patterns with some countries above the Brandt line
Development Gap
The northsouth divide has more recently been named the development
continuum gap.
places greater emphasis on closing the evident gap between RICH
(more economically developed - MED) and POOR (less
economically developed -LED) countries.

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World map by quartiles of Human Development Index in 2014

A good measure of on which side of the gap a country is located is the

Human Development Index (HDI).
The nearer this is to 1.0, the greater is the country's level of development
and the further the country is on its development pathway (closer towards
being well developed), exemplified well by Walter Rostow's model of
development
Defining Development
The South (accdg. To

lacks the right technology,

politically unstable,
their economies are divided,
their foreign exchange earnings depend on primary product exports which
come from the North,
fluctuation of prices.
little control of imports and exports
These conditions condemned the South to obey the imperialist system
Defining N-S Development
The lack of the South and the development of the North furthers the
inequality and end up putting the South as a source of raw material for the
developed countries.
The NORTH = synonymous with economic development and industrialization
The SOUTH = represents the previously colonized countries which are in
need of help in the form of international aid.
In order to understand how this divide occurs, a definition of development
itself is needed.
Defining Development
Development: processes of social change or
[a change] to class and
state projects to transform national economies - The Dictionary of Human
Geography
This definition entails an understanding of economic development which is
imperative when trying to understand the northsouth divide.
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Economic Development is a measure of progress in a specific economy.

refers to advancements in technology,

transition from an economy based largely on agriculture to one based on
industry and an improvement in living standards.
Other factors: life expectancy and the levels of education, poverty and
employment in that country

Digital and Technology Divide

The global digital divide is often characterized as corresponding to the north
south divide; however, Internet use, and especially broadband access, is now
soaring in Asia compared with other continents.
This phenomenon is partially explained by the ability of many countries in Asia to
bypass older Internet technology and infrastructure, coupled with booming
economies which allow vastly more people to get online.
The DIGITAL DIVIDE
The digital access index (DAI) measures the gap between countries and their
ability to access and use ICT
Theories explaining the divide
Uneven immigration patterns lead to inequality:

in the late 18th and 19th centuries, immigration was very common into
areas previously less populated (North America, Argentina, Brazil,
Australia, New Zealand) from already technologically advanced areas
(United Kingdom, Spain, Portugal).
This facilitated an uneven diffusion of technological practices since only
areas with high immigration levels benefited. Immigration patterns in the
twenty-first century continue to feed this uneven distribution of
technological innovation.

People are eager to leave countries in the South in attempts to better their
life standards and get their share in the perceived prosperity of the North.
South and Central Americans want to live and work in North
America. Africans and Southwest Asians want to live and work in
Europe.
Southeast Asians want to live and work in North America and
Europe.

Future Development
Some economists have argued that international free trade and unhindered
capital flows across countries could lead to a contraction in the NorthSouth
divide.
In this case more equal trade and flow of capital would allow the possibility for
developing countries to further develop economically.
However policymakers in the South are often skeptical of capitalism and have
proposed alternative solutions.

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In 1974, Southern nations called for a New International Economic Order (NIEO)
to restructure the global economy
Demands: included linking prices of commodity exports to manufactured
imports
transferring of technology from North to South, canceling or rescheduling
debts of Third World
improving representation in economic playersWorld Bank, UN Security
Council,
standardizing prices for raw materials
solving food crises
"opening up of the Norths market for manufactured or semi-processed
goods of the South."
As some countries in the South experience rapid development, there is evidence
that those states are developing high levels of SouthSouth aid.
Brazil, in particular, has been noted for its high levels of aid ($1 billion annually
ahead of many traditional donors) and the ability to use its own experiences to
provide high levels of expertise and knowledge transfer.
This has been described as a "global model in waiting.

United Nations has also established its role in diminishing the divide between
North and South through the Millennium Development Goals (2015).
These goals seek to eradicate extreme poverty and hunger; achieve universal
primary education; promote gender equality and empower women; reduce child
mortality; improve maternal health; combat HIV/AIDS, malaria, and other
diseases; ensure environmental sustainability; and develop a global partnership
for development.
Sustainable Development Goals

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IMPERIALISM AND COLONIALISM

IMPERIALISM - is the forceful extension of a nation's authority by territorial
conquest or by establishing economic and political domination of other nations
that are not its colonies.
COLONIALISM is a practice of domination, which involves the subjugation of
one people to another.
Difference between Colonialism and Imperialism
Colonialism comes from the Latin word colonus, meaning farmer.
Imperialism comes from the Latin term imperium meaning to command.
Simplest way to distinguish the two is to think of:
COLONIALISM as PRACTICE while IMPERIALISM as the IDEA driving the
practice.
History
imperialism may be as old as humanity.
In the pre historical world (before written history began), clan groups
extended their territory and dominated others, competing against them for
food and resources.

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 both ancient and modern imperialism, tended to regard themselves as

spreading order, morality, the true religion and civilization, and have even
claimed to occupy the high moral ground.
The term "Imperialism" was coined in the sixteenth century, reflecting the
imperial policies of Spain, Portugal, Britain, France, and the Netherlands
into Africa and the Americas.
Although the practice dates thousands of years, the nineteenth century is
the "Age of Imperialism" and refers to Europeans colonizing other
countries.
In the mid-1800s, Britain was the most powerful nation in the world
Its factories produced more goods than those of any other country.
British banks loaned the money needed to build factories, mines,
and railroads worldwide.
By the late 1800s, however, Germany and the United States were
challenging Britains economic leadership.
Faced with possible decline, Britain looked increasingly to its colonies for
markets and resources.
And other countries followed Britains lead and came to see colonies as
necessary for their economic well-being.
NEO-COLONIALISM, GLOBALIZATION & WORLD-SYSTEMS THEORY
Neo-colonialism or neo-imperialism - is the geopolitical practice of
using capitalism, business globalization and cultural imperialism to
influence a country, in lieu of either direct military control (imperialism) or
indirect political control (hegemony)
Globalization - is the process of interaction and integration among the
people, companies, and governments of different nations, a process
driven by international trade and investment and aided by information
technology.
World Systems Theory developed by Immanuel Wallerstein, is an
approach to world history and social change that suggests there is a world
economic system in which some countries benefit while others are
exploited.
Core areas
Semi-periphery areas
Periphery areas
Capitalism
Adam Smith - Capitalisms founding Father

coined the terms invisible hand and division of labor

It is not from the benevolence of the butcher, the brewer, or the baker that we
expect our dinner, but from their regard to their own interest. We address
ourselves not to their humanity but to their self-love, and never talk to them of our
necessities but of their advantages
Lenins Theory of Imperialism
In Vladimir Lenins essay Imperialism, the Highest Stage of Capitalism, he
describes the function of financial capital in generating profits from
imperialist colonialism, as the final stage of capitalist development to
ensure greater profits.
Per Lenin, Imperialism is Capitalism, with five simultaneous features:
(1) Concentration of production and capital led to the creation of national and
multinational monopoliesnot as in liberal economics, but as de facto power
over their marketswhile "free competition" remains the domain of local and
niche markets:
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(2) Finance capital replaces industrial capital (the dominant capital), (reiterating
Rudolf Hilferding's point in Finance Capital), as industrial capitalists rely more
upon bank-generated finance capital.
(3) Finance capital exportation replaces the exportation of goods (though they
continue in production)
(4) The economic division of the world, by multi-national enterprises via
international cartels
(5) The political division of the world by the great powers, wherein exporting
finance capital to their colonies allows their exploitation for resources and
continued investment. This super exploitation of poor countries allows the
capitalist industrial nations to keep some of their own workers content with
slightly higher living standards (cf. labor aristocracy; globalization).
Marxs Theory of Imperialism
Marxist imperialism theory, and the related dependency theory, emphasize
the economic relationships among countries (and within countries), rather
than formal political and military relationships. Thus, imperialism is not
necessarily direct formal control of one country by another, but the
economic exploitation of one by another. This Marxism contrasts with the
popular conception of imperialism, as directly-controlled colonial and
neocolonial empires.
Negative legacy of Imperialism
Imperial powers have often regarded themselves as superior to others,
especially to those people who live in conquered territory.
Often, the enemy or the vanquished were depicted as inferior.
Positive Legacy of Imperialism
Despite all the negative experiences of colonialism, communication and
transportation infrastructures built during colonial times have brought more
and more people into contact with each other. More and more people
understand themselves as citizens of the world and realize that such
challenges as the ecological crises, eradicating poverty, combating
disease can only be met by global cooperation among the nations. Talk of
universal human rights and the insight of many that shared values
permeate the cultures and faiths of the world, despite their diversity and
variety and some differences too, would be inconceivable but for the
imperial enterprises that once crossed the globe.
Marxism
There is a great influence of Karl Marx during his time
During the 1980s, Marxist numbered about one half of the planet's
inhabitants
Chinese alone account for one billion but the Russian claimed to be the
leading Marxists
More Marxists compared to Christians
Walter Laquer joked that by the 1980s, there were probably more
believing Marxists in American universities than in the entire Soviet Union
Karl Marx was the most influential modern thinker
Marx is known to be the founder of the modern study of history, sociology,
and economics
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 Prophet of proletarian revolution

Karl Marx is a son of a well off lawyer in the Rhineland city of Trier
He became an intellectual outsider and critic, a professor of revolution
He became a teacher of revolutionaries rather than a revolutionary himself
Ph.D. from the prestigious University of Berlin in 1836
Rheinische Zeitung
European correspondent for Horace Greeley's newspaper, the New York
Tribune
Exiled from Germany for radical activities in 1849
A few months later he was asked to leave France
After a brief time in Brussels, he settled in London in 1851
Das Kapital

Marxism
Refers to the political and economic theories of Karl Marx and Friedrich
Engels
Believed that history was largely determined by the struggle between the
ruling classes and the oppressed classes, which had conflicting interests
Believed that if workers could overthrow capitalism, they would be able to
build a socialist society
Marxists believe that they and they alone have the analytical tools to
understand the process of historical change, as well the key to predicting
the future
Marxists also believe that they and they alone have an empirical, scientific
approach to human history and society
The Main Ideas of Marxism
1. Materialism
Engine that drives society is the economy
Economic forces are more complex and pervasive
The mode of production in material life determines the general character
of the social, political, and spiritual processes of life
It is not the consciousness of men that determines their existence, but on
the contrary their social existence that determines their consciousness
Marx suggests that individuals really do not think independently at all;
rather, the great majority of people simply repeat the dominant ideas of
their time in place of thinking
People who control the economy also control the political arena
Merely parrot the rhetoric of the ruling class
2. Class Struggle
All of human history can be explained and predicted by the competition
between antagonistic economic classes
The history of all hitherto existing society is the history of class
struggles.
Social classes are competing in essence for control of the state
the class that controls the Mode of Production also controls
the State
Political life is only veil for the real struggle
Fundamental division in every society is that between the exploiters and
the exploited, between the owners of the means of production those who
have to sell their labor to the owners to earn a living.
Bourgeoisie vs. Proletariat:

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 Bourgeoisie: Simply means capitalist, or management. Those who control

the means of production.
Proletariat: The industrial working class wage labor. But Marxists look very
carefully at who belongs here no artisans, no peasants, no farm laborers.
The Proletariat is the factory workers or simply those who have nothing
but their hands
The key is to seize control of the productive process and to make it work
in favor of the exploited masses instead of enriching a tiny minority of
capitalists.
The Inevitable Revolution
Rapid expansion of the economy and of the factory system is the most
important thing that happened in the human history
The more that production is concentrated into factories, the more the
revolutionary working class is strengthened
more acute becomes the competition and antagonism between
bourgeoisie and Proletariat, capital and labor
Ownership of capital will become concentrated in few hands
Many former capitalists will fail and sink down into the proletarian mass
The State too will disappear, or "wither away"
the state is simply an instrument of coercion and coercion will no
longer be necessary
Ideas were all expressed in one of the great literary documents of the
nineteenth century, the Communist Manifesto

DEVELOPMENT DOCTRINES
Intentional and Spontaneous Development
Examines development as an idea and practice (early 19 th Century to late
20th Century)
What is Development?
Implies improvement or positive qualitative change
Used to mean greater human freedom and well-being
Prof. Nadarajah Shanmugaratnam
Development process is uneven and conflict-ridden with mixed
consequences
Accumulation of wealth and enhancement of freedom and well-beings
Impoverishment
Marginalization
Reinforcement of power structures
Violations of human rights
Spread of destructive and internal wars
Environmental degradation
Intentional Development
Implies subjective policy interventions to manage the economy and to deal
with the socio-political problems
Consist of means to compensate negative propensities of capitalism
though the reconstruction of social order
Spontaneous Development
Unintended outcome of individuals decisions made in production and
trade

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How to create order in society (Adam Smith)

Individual self-interest is the driving force of evolution of the social system
Laissez faire as a natural order (Invisible hand)
The state must establish the prior conditions for laissez faire
Modern private property rights and their enforcement
Public works (infrastructure)
Administration of justice
Taxation should not interfere with the allocative mechanisms
Defense

Model of perfect competition and spontaneous order

Division of labor> increased productivity> increased output> higher
wages- Higher per capita income
Higher level of consumption> greater wealth of a nation > Increased
capital accumulation > Division of labor

Dynamics of modern society

Double Movement (two organizing principles)
Establish a self-regulating market
+
Social protection
Gender and Development

1. That, this is not a WAR OF THE SEXES;

2. That, we are not ANTI-MALE;
3. That, both WOMEN and MEN are victims, although WOMEN are
usually/oftentimes the victims than MEN;
4. That, both MEN and WOMEN have a stake in the struggle from Gender
Equality.
Women make up the 70% of individuals living in poverty and in subSaharan Africa 57% of HIV infected individuals are women
disproportionate ratio of women to men in the job market and at leadership
position
low level of education among women
and low socio-economic status among women.

Difference between sex and gender:

SEX Is a natural distinguishing variables based

on biological characteristics of being a woman or man. It refers to physical
attributes pertaining to a persons body contours, chromosomes and
reproductive organs.
GENDER - Refers to the socially differentiated roles, characteristics and
expectations attributed by culture to women and men. It is set of characteristics
that identifies the social behavior of women and men and the relationships
between them.
SEX
*Categorized as male & female
*Biological
*Fixed at birth
*Does not change across time and

GENDER
*Masculinity & femininity
*Socially, culturally and historically
determined
*Learned through socialization
*Varies over time and space
26

space
Equally valued

*Unequally valued (masculinity as the

norm)

Welfare Approach
the era of decolonization and political transitioning in most African and Asian
countries (1950s 1970s)
response to most of the newly independent countries outcomes of inequalities
among the local elites and the common man in each nation.
Most international development agencies applied a very western approach
towards helping these nations develop.
modernization theory, and the Malthusian theory (Population vs.
Resources).

These brought about a negative impact and outcome towards most

developing nations development and it also help to further impede on its
progress.

Women in development (WID)

It is the integration of women into the global economies by improving their status
and assisting in total development.
It was originated as a result of three major feminist moments/waves concerning
feminine conditions.
First Wave : Womens Suffrage Movement
It originated in the North America back in the late 19th century, when women
fought for the equal right to vote and participate in politics.
Second Wave : Social and Cultural Inequalities
sexual violence,
reproductive rights,
sexual discrimination and
glass ceilings
Third Moment: Womens Role in Economic Development
A publication Ester Boserup
She states and gave empirical results of how increasingly specialized division
of labor associated with development undermines or neglects the value of
womens work and status especially in the developing world.
In 1973, the US congress implemented a bill, which required the USAID to
include women in development programs.
Criticism
Very Western! Fails to acknowledge the collective and cultural concerns of
women in the developing world.
It ignores the larger social processes that affect women's lives and their
reproductive roles.
The approach does not address the root causes of gender inequalities.
Women and Development
originated back in 1975 in Mexico city, as it sort to discuss womens issues from
a neo-Marxist and dependency theory perspective.
explain the relationship between women and the process of capitalist
development in terms of material conditions that contribute to their exploitation

27

WAD stresses the relationship between women, and the work that they perform
in their societies as economic agents in both the public and domestic spheres.
In general, WAD is thought to offer a more critical conceptualization of womens
position in the society.
CRITICISM
That their concern is that the women-only development projects would struggle,
or ultimately fail, due to their scale, and the marginalized status of these women.
WAD fails to fully consider the relationships between patriarchy, modes of
production, and the marginalization of women.
What is GAD?
The GAD (or Gender and Development) approach focuses on the socially
constructed basis of differences between men and women and emphasizes the
need to challenge existing gender roles and relations.
Theory of GAD
GAD was developed in the 1980s as an alternative to the Women in
Development (WID) approach.

Unlike WID, the GAD approach is not concerned specifically with women, but
with the way a society assigns roles, responsibilities and expectations to both
men and women.
GAD applies gender analysis to uncover ways in which men and women work
together, presenting results in neutral terms of economics and efficiency.
Two Main Goals of GAD:
to prove that the unequal relationship between the sexes hinders
development and female participation.
to change the structure of power into a long-term goal whereby all
decision-making and benefits of development are distributed on equal basis of
gender neutrality.
GAD approach is not just focused on the biological inequalities among sexes:
men and women;
on how social roles, reproductive roles and economic roles are linked to Gender
inequalities of: masculinity and femininity.
Caroline Moser developed the Moser Gender Planning Framework for GADorientated development planning in the 1980s while working at the Development
Planning Unit of the University of London. Working with Caren Levy, she
expanded it into a methodology for gender policy and planning. The Moser
framework follows the Gender and Development approach in emphasizing the
importance of gender relations.
Effectiveness Approach
WID
the inequalities women faced and how societies fail to acknowledge the
impact of women in economic development.
Include women in the development projects and reinforce their labor and
productivity in the labor market.

28

Mainstreaming Gender Equality

Gender mainstreaming: a is an approach to
development that looks more comprehensively
at the relationships between women and men
in their access to and control over resources,
decision making, benefits and rewards in society.
- that all gender issues are address and integrated in all levels of society,
politics, and programs.
It originated in 1995 at the 4th UN conference on women in Beijing, China.
At the forum, 189 state representatives agreed that the inclusion of both
women and men in every development project was the only way to
succeed and progress in a nation economic growth and
development.
Through MGE organizations like CIDA has to include men and women in
their annual development report concerning the allocation of funds spent
towards education, health care, and employment of both sexes.

In conclusion to all the six main theoretical approaches.

First, It is important to note that no approach can be neutral in terms of its effect
on the power relationship between men and women.
Second, gender inequality is highly linked with the power struggle that hinders
the recognition of women as significant actors and negotiators of the
development processes.
Finally, the need for including actual fieldwork results into theories of
development. Basically, the collective needs of individuals need to be put into
consideration when implementing various development theories.
Most Applicable in the global south:
Non-Applicable in the global north

29