39 - 1 Copyright McGraw-Hill/Irwin, 2002 The Rich and the Poor Growth, Decline, and Income Gaps...

39 - 1Copyright McGraw-Hill/Irwin, 2002

The Rich and the Poor

Growth, Decline, and Income Gaps

Overpopulation Impact Upon Development

Capital Accumulation

Vicious Cycle of Poverty

Role of Government

Role of Advanced Nations

Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

THE ECONOMICS OF DEVELOPING COUNTRIES

39C H A P T E R







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

THE RICH AND THE POORIACs Industrially Advanced

Countries

DVCs Developing Countries

Global Income DisparityWorld population Percentage of world income

Richest 20%Poorest 20%Poorest 60%

Greater than 80%Less than 2%Less than 6%







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

GROWTH, DECLINE, & INCOME GAPS

Differences in AbilityWidening Income GapObstacles to Economic Development

Greater EfficiencyExpand Resources

Natural ResourcesHuman Resources







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

GROWTH, DECLINE, & INCOME GAPS

Poorest DVCs• Overpopulated• Unemployment and Underemployment Widespread

• Labor Productivity is Low

StandardOf Living

Consumer Goods (Food) Production

Population=







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

OVERPOPULATION IMAPCTUPON DEVELOPMENT

Saving and InvestmentProductivityResource OveruseUrban ProblemsDemographic Transition ViewUnderemploymentLow Labor Productivity

Brain Drain







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

CAPITAL ACCUMULATION

DVC Capital Goods Shortages

Domestic Capital Formation•Savings Potential•Capital Flight•Investment Obstacles

•Infrastructure







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

CAPITAL ACCUMULATION

Technological Advance

Sociocultural & Institutional Factors

•Capital-Saving Technology•Capital-Using Technology

•The Will to Develop•Capricious Universe View•Land Reform







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

ROLE OF GOVERNMENTA Positive Role• Law and Order• Lack of Entrepreneurship• Infrastructure• Forced Saving and

Investment• Social-Institutional

ProblemsPublic Sector Problems

•Corruption







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

ROLE OF ADVANCED NATIONS

Expanding Trade

Foreign Aid

Public Loans and Grants

Direct Aid

The World Bank Group







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

ROLE OF ADVANCED NATIONS

Foreign Harm?Dependency and Incentives

Bureaucracy & Centralized

Government

Corruption & Misuse

The Decline of Foreign Aid

Flows of Private Capital







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

WHERE FROM HERE?DVC Policy For Promoting Growth• Establishing the Rule of Law• Opening to International Trade• Controlling Population Growth• Encouraging Foreign Direct

Investment• Building Human Capital• Making Peace with Neighbors• Establishing Independent

Central Banks• Realistic Exchange-Rates• Privatizing State Industries







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

WHERE FROM HERE?IAC Policies For Fostering DVC Growth• Directing Foreign Aid to the

Poorest DVCs• Reducing Tariffs and Import

Quotas• Debt Forgiveness to the Poorest

DVCs• Admitting in Temporary

Workers and Discouraged Brain Drains

• Discouraging Arms Sales to DVCs







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow

WHERE FROM HERE?IAC Policies For Fostering DVC Growth• Directing Foreign Aid to the

Poorest DVCs• Reducing Tariffs and Import

Quotas• Debt Forgiveness to the Poorest

DVCs• Admitting in Temporary

Workers and Discouraged Brain Drains

• Discouraging Arms Sales to DVCs

ChapterConclusions

industrially advanced countries (IACs)

developing countries (DVCs)

demographic transition view

underemployment

brain drain

capital flight

infrastructure

capital-saving technology

capital-using technology

the will to develop

capricious universe view

land reform

vicious circle of poverty

corruption

World Bank

direct foreign investment

ENDBACKCopyright McGraw-Hill/Irwin 2002







Role of Government


Where From Here?

Key Terms

PreviousSlide

NextSlide

EndShow Next: Web Chapter

Transition Economies:

RUSSIA & CHINA

39 - 1 Copyright McGraw-Hill/Irwin, 2002 The Rich and the Poor Growth, Decline, and Income Gaps...

Documents

Transcript of 39 - 1 Copyright McGraw-Hill/Irwin, 2002 The Rich and the Poor Growth, Decline, and Income Gaps...