Development - Edexcel Unit 4

Full Revision notes on Edexcel unit 4 on devlopment

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Harry Bindloss
Gross Domestic Product. The total market value of all final goods and services produced in a
country in a given year, equal to total consumer, investment and government spending, plus
the value of exports, minus the value of imports. It is important to differentiate Gross
Domestic Product from Gross National Product (GNP). GDP includes only goods and
services produced within the geographic boundaries of the UK, regardless of the producer's
nationality. GNP doesn't include goods and services produced by foreign producers, but does
include goods and services produced by UK firms operating in foreign countries.
Human Development Index (HDI);
This is also a composite measure of human development, developed by the United Nations
Development Programme (UNDP) for use in its annual series of Human Development
Reports (available free of charge on the Internet). It includes a measure of longevity (life
expectancy at birth), knowledge ( adult literacy and mean years of schooling) and
standard of living (real GDP per capita adjusted for PPP).
For each indicator, the performance of individual countries is rated on a scale of 0 to 1,
where 0 represents the worst and 1 the best. The composite index is calculated by taking
the average of the 3 ratings, giving equal weighting to each. The nations are then ordered
from the highest HDI value to the lowest and given a ranking. A nation ranked number 1 is
top in human development and the nation at the bottom of the table 162nd is performing
worst. In 2001, according to the HDR Norway was top and Sierra Leone was bottom.
Countries are categorised into one of three groups: high human development, medium
human development and low human development.
The HDI measures relative and not absolute levels of human development. A major
advantage of the HDI is that it can be disaggregated to show the different experiences of
men/women, social classes, regions within a country, ethnic groups and income groups.
Poverty Cycle Trap

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Breaking out of the poverty Cycle
Subsidise capital goods
Lean Production
Supply Side
Attract FDI
Family Planning
Buffer Stock
Micro financing
Fair trade
Sectoral Change
Primary Sector: Working in agriculture and the most basic jobs
Secondary Sector: Working in manufacturing and production
Tertiary Sector: Working in technology and services
The movement from primary to secondary is called Industrialisation
The movement from secondary to tertiary is called deindustrialisation
Problems of primary product dependency for LEDC's
Unemployment - Seasonal unemployment
- Under Employment
Instability…read more

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- So started making more crops
- Price decreases
- Depletion of resources
The four problems with structural change
1) Factor mobility
a) Land ­ Not very mobile
b) Labour- Occupationally/Geographically
c) Capital ­ Not very occupational and can be expensive
2) Structural Unemployment
3) Rural/Urban migration
a) Lack of primary employment
b) Overpopulation ­ Increased black market and crime
c) Worse living conditions
4) Neglect of agriculture
a) More people leaving the agriculture.…read more

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Underdevelopment ­ Higher standards of living would allow people to take care of
Resource depletion ­ If you can address this then it wouldn't be as much of a problem
Population distribution ­ There is a lot of space in country side etc.
Subordination of women ­ Empower more women. Give them choices such as
Population growth is good ­ Keeps labour down. Prices go up and there are more people
to buy goods.…read more

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Cultural values and tradition values erode
Government resources such as infrastructure projects are targeted and local people
can't use them
Tourism may be enclosed in nature
There can be leakages in the economy
Seasonal unemployment
Tourism is YES elastic
High import elasticity of demand
Hotels etc. are owned by MNC's - Profits would therefore go to domestic countries
Negative externalities
New cultures and traditions
Types of Aid
1. Grants ­ A sum of money given for a specific development project
2.…read more

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Fair Trade schemes: Schemes that set out to ensure that small producers in LEDC's receive
a fair price for their products.…read more


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