Economic Indicators

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  • Economic Indicators
    • The Brandt Line
      • 1980s
        • Countries have changed since
      • Divided the world into north and south
        • North = Rich
        • South = Poor
        • Physically incorrect as New Zealand and Austrailia are in the south but above the line
      • Economies are far more complex than Manufacturing and Agriculture
    • Wealth is a significant and widely used indicator of development
      • GNI (Gross National Income)
        • Popular measurement of wealth
        • Calculated per capita (per head)
        • In 2016, the US had a GNI of $60,000 whereas India had $6,700
          • USA is wealthier and more developed
            • However, there are 45,000 millionaires in India's financial capital of Mumbai
        • GNI assumes wealth is shared equally when it is not
    • How wealth is generated
      • If greater wealth comes from agriculture than from banking or service industries, the country is usually less developed
        • Therefore we often look at the percentage of people employed in each sector
          • Primary
            • HICs have very few people employed in primary jobs such as farming
              • So well developed that a few people can produce large amount of produce
              • What the country does not grow it can import
            • LICs rely heavily on agriculture
              • Farmers growing just enough to survive on
          • Quaternary
            • Research
          • Tertiary
            • Large demand for the services provided by the tertiary sector in HICs
              • Banking, teaching, building, etc.
              • Higher disposable income and leisure time
                • Hairdressing, tourism, leisure, etc.
                  • Seen as unaffordable luxuries in LICs
    • Purchasing Power Parity (PPP)
      • Compares what can be brought with the same amount of money in different countries
        • Useful as it considers the cost of living
          • For example, a dollar will buy more in Afghanistan than the UK
      • Scandinavian countries tend to have the highest PPP
      • Asian counties tend to have the lowest PPPs
    • Don't tell us if a ccountry is a pleasnt place to live
      • Or whether the people are happy and free from oppression
        • Only give a general picture of the country

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