Chapter 10

Gross National Product-

A measurement of a country's wealth that includes the total value of all goods and services produced by residents of a country, including domestic and foreign production, in a year. (Includes goods and services made inside and outside a country's territory)

Structural Adjustment Loans-

A set of requirements to open markets, privatize industries, and allow foreign direct investment in developing countries in exchange for loans from international financial institutions.

Gross National Income:

Most measures of development focus on one of 3 factors: econ well-being, tech and production, or social welfare. Beginning of 1960s, most common way to measure econ well-being to use index economists made to compare countries: GNP. Therefore broader than GDP.

Trafficking-

A form of forced migration in which organized criminal elements move people illegally from place to another, typcially either to work as invountary laborers or to participate in the commercial sex trade. Lack of edu for girls made worse by assumption that girls should only leave homes and communities wehn marry and contribute to husband's fam. Types of assumptions, when taken to extreme, feed into human trafficking of glirs and young woemn, seen as less imprtatn than boys and treated as finainacl drains bc of assumption that their earring potential is limited. Modern antislavery activist, explains that tracking happens when adults and kids feeling poverty or seeking better prospects are manipulated, deceived, and bullied into working conditions that wouldn't choose. Trafficking not usually considered slavery bc fam doesn't sell child. Instead, fam sends child away with recruiter in hopes kids will earn money to send home. Trafficked kids often taken to neighboring or nearby counties that wealthier and where demand for domestic servants is high.

Gross Domestic Product-

A measurement of a country's wealth that includes the total value of all goods and services produced within a country in a year.

Gross National Income-

A measurement of a country's wealth that includes the total value of all goods and services produced within the borders of a country, plus income received from investments outside of the country in a year. Economists increasingly turned to GNP as measure of development. GNI is calculation of monetary value of what's produced within country, and income received from investments outside country, - income payments to other countries round world. It's seen as more accurate way of measuring country's wealth bc it accounts for wealth generated by investments outside country's borders. Using GNI to measure wealth has many shortcomings. First, includes only transactions in formal econ. Quite few countries have per capita GNI of less than $1000- a figure so low it seems impossible that peeps could survive. Key component of survival in these countries is informal econ. Informal econ is signif element in econs of many countries, but GNI statistic omit informal econ entirety. GNI per capita also says nothing bout distribution of wealth across world or within country. But these figures give no hint of what proportion of pop participates in country's econ, average citizen's standard of living or gaps between genders among region. Nother limitation of GNI per capita is measuring only outputs (ie production). Doesn't take into account nonmonetary costs or product, which takes toll on enviro through resources depletion and pollution of air and water. Per capita GNI may even treat such matters as +. Ex of this sale of cigarettes, which augments GNI, When cig use leads to sickness and hospitalization, GNI figure growth. Conversy, quitting improves health and saves lives, but reduces money spent on cig and health care, reducing total production and GNI.

Aid and International Financial Institutions:

A num of countries in global econ core offer aid to lower income countries. Foreign aid can serve as catalyst for development, as was dramatically illustrated when US pumped $12 (now worth $100 bil) bil into W Eu after WWII as measure to help region get back on its feet (marshall plan). Aid initiatives, though, rarely driven solely by concern for well-being of others (altruism). Aid progs also refer interests of donor countries. Marshall PLan not just bout helping Eu. US wanted to build strong transatlantic alliance and help Eu resist expanding Soviet influence. Development assistance may be given to stop probs in receiving country from impacting donor country. Ex, donor country may give aid to stabilize neighboring country with hope of stopping or slowing flow of migrants into donor country. Donor countries may give development aid to gain access to markets in receiving country or exert political control over their gov. Some donor countries approach development aid altruistically. May believe all counties do better when sitch of lower income, struggling countries improves. Interests of donor countries are prime drives in development aid, and donor countries may make aid decisions that harm recipient countries. Ex, if donor country ships food or clothing regularly, steady supply of goods from donor country will undermine domestic production. Ag and textile industries in the receiving country will have fewer customers and less incentive for production.

Break-of-Bulk-

A place where goods are transferred from one form of transportation to another. Ex, in a port, continents are unloaded from ships and put on trains, trucks, or riverboats for inland distribution.

Social Conditions:

Across global periphery, as much as half pop is 15 ye older or younger, making supply of adults, taxpaying laborers low relative to num of dependents. Low life expectancies and high infant and child mortality rates stem from inadequate nutrition. Despite Un efforts to achieve Sustainable Development Goals, kust under one in 4 kids worldwide had stunted growth in 2017; don't receive enough cals to grow as tall as should for their age. Peripheral countries have little access to public sewage systems, clean drinking water, and health care making econ development all more difficult. Un says 159 mil peeps still rely on unsafe drinking water from rivers, ponds, and unprotected wells and springs, and close to 900 mil peeps still practiced open defecation in 2018. Lack of access to edu also major prob in periphery. But, num of kids in periphery enrolled in primary school, boys and girls, increased since 2000, thanks to gov efforts to extend edu. Gov used innovative policies to promote edu, including financial incentives for fams to enroll and send kids to school. Historically, kids would drop out of primary school or have low attendance so could help fam by working in farms and factories, or providing kid or eldery care at home. Kids in peripheral countries often had to pay fee for attending school, and in some places girls drop out to earn wages to pay school fees for brothers. Cash transfer policies seek to undermine practice by providing financial incentives to enroll at school and attend regularly. Yet prob persists- particularly in rural areas where girls from lower income fams are least likely to attend primary school.

Alternative Measures of Development: 2

Addition to access to tech and dependency ratios, can use many other statistics to measure social welfare, including literacy rates, infant mortality, life expectancy, undernourishment, % of fam income spent on food, and amount of savings per capita. UN calculates Human Development Index to incorporate 3 basic dimensions of human development: long healthy life, knowledge and decent standard of living. Several statistics, including per capita GDP, literacy rates. school enrollment rates, and life expectancy at birth, are included in calculations of Human Development Index. In 2015, UN held a high-profile summit where more than 150 world leaders adopted Agenda for Sustainable Development. Goal to improve condition of peeps in countries with lowest standards of human development. At summit, world leaders recognized principal barriers to econ development and identified key development goals to be achieved by 2030.

Sustainable Development Goals-

Agenda agreed to by member countries of the UN to improve peoples' lives across several human conditions, including education, environment, political liberty, poverty, and inequality. It represented fairly high degree of consensus bout conditions need to be changed to achieve econ development. Looking across all maps showing dif measures of development, clear that many countries come out in approximately same position, no matter which measure used. And all maps and statistics share a fundamental limitation: Don't capture difs in development within countries, issue consider later in chapt.

Washington Consensus-

Agreement among international financial institutions that policies opening markets in lower income countries would lead to econ development.

Shifting Cultivation-

Agricultural practice based on clearing and farming land for a time before moving on to a new parcel and allowing the first to fill in with native vegetation.

Costs of Tourism: 1

All development strategies have pros and cons, and illustrated by tourism. Peripheral island countries in Caribbean region and Oceania remove leading destinations for mills of tourists from richer states. Tourism now one of major industries in world and surpassed oil in overall econ value. While tourism can bring employment to peripheral countries. Can also have serious neg effects on cultures and enviros. To develop tourism, the host country must make substantial investment infrastructure, including airports, cruise ports, roads, and communication systems. High-end hotels, swimming pools, and man-made waterfalls are typically owned by large multinational corps, not locals, Multinational corps earn large profits, most sent back to owners. Shareholders, and executives outside country. Tourism can make local jobs, but often low paying, and most don't offer job security. In torusiot zones, employees sometimes work 2 or 3 jobs to break even. Tourism frequently stairs fabric of local communities too. The invasion of lower-income communities by wealthier visitors can lead to resentment. Tourism can also have effect of altering, and debasing, local cult, which adapted to suit tastes of visitors.

Dependency Theory-

Andre Gunder Frank's theory that wealthy counties set up exploitative economic relations whereby lower income countries become dependent on wealthy counties, who in turn benefit economically. Structuralists developed this major body of development theory which holds that political and econ relationships between counties and regions of world control and limit econ development possibilities of lower income areas. Dependency theorist note, ex, that colonial made political econ structures that caused colonies to become dependent on colonial powers. They further argue that such dependency helps sustain wealth in developed regions and poverty in other areas, even after decolonization happens. Dependency theory banked on idea that econ prosperity is difficult to achieve in regions and countries that have traditionally been dominated by external powers bc decency relation continues after independence.

Island of Development-

Cities in developing regions where foreign investment is concentrated and to which rural migrants are drawn. When gov or corp builds up and concentrates econ development in certain city or small region, geos call it island of development. Identified islands of development in periphery and semiperiphery, and discussed why peeps migrate to these places from lower income areas. Hope for jobs drives many migrants to move to these islands of comparative prosperity.

Industrial Revolution-

Cluster of inventions and innovations that brought large-scale economic changes in agriculture, commerce- and manufacturing in late eighteenth century Europe.

Economic Arrangements:

Concentration of wealth and power in global econ core that resulted from colonialism and early industrialization put econ actors in theos places in driver's seat. Increasingly powerful corps developed with global reach- transnational corps- that had ability to shape patterns of development through investment strategies. Huge banana comps like Chiquita could come into country like Ecuador, promote development of vast banana plantations, and create econ was heavily dependent on single commodity- meaning that development process emcs hostage to ups and downs of global banana market.

The Role of Governments:

Contrasts between rich and poor areas not just result of dif in econ endowment of places. Gov policy affects development patterns too. Gov influence the geo of wealth through tariffs, trade agreements. taxation arrangements, land ownership rules, enviro gers, and more. Gov policies shape patterns of development within states- between urban and rural areas and among dif sectors of the econ. Govs alone don;t determine patterns of wealth and poverty. But usually part of pic. Every gov polcu has geo expression, meaning that some regions favored whereas others aren't. When policies come together to favor some regions over others, uneven development result. Uneven development often becomes worse over time as wealthy areas grow weather and poorer areas stagnate. Returning to consideration of commodity chains also helps us understand role gov play in uneven development- within and between states. Though written more than 15 ye ago, econ book still offers relevant insgt to influence gov has on distribution of wealth between and within states. Shirts then shipped to Us for sale. US gov established quotas on how many items from various clothing categories can be imported to US from China and other countries. Unintended consequences of quota system been "quota market" that allows countries to buy and sell their US quota nums to producers in other countries (illegal but common practice). Instead of trading quotas, some production facilities moved to places where quotas and cheap labor avail- like Sri Lanka, Poland, and Lesotho. Rivoli describe how one producer of cotton shirts moved round world. Point is that quota laws, like other policies made by govs, and international financial institutions like the World Trade Org and International Labor Org, affect whether and how regions can produce and exchange goods on the world market.

World-Systems Theory: 1

Core regions have high levels of econ prosperity and dominant players in world econ. When peripheral processes found in place, processes often generate little wealth for peeps in that place. Periphery regions are lower income that dependent in signif ways on core and don;t have as much control over own affairs, economically or politically. Semiperiphery has core and peripheral processes, with semiperipheral places serving as buffer between core and periphery in world econ. Countries of semiperiphery exert more power than peripheral but remain heavily influenced by core regions. Dividing world into cores, semi peripheries, and peripheries might seem to do little more than replace developed, developing, and underdeveloped with new terms. But core-periphery model dif from modernization model bc holds that not all places can be equally wealthy in capitalist world econ. World-systems theory also makes power relations among places explicit and doesn;t assume that socioeconomic change will happen in same way in all places. Thus sensitive to geo context, at least in econ terms. World-systems theorists see domination (exploitation) as function of capitalist drive for profit in global econ. Thus, capitalists can move production from one place to nother round globe to enhance profits, but places that lose production facility can suffer. Their coping capacity can be small if, as is often the case, they abandon traditional ways and shift to export econ once external investments arrives.

Three-Tier Structure-

Division of the world economy into the core, periphery, and semi periphery according to Immanuel Wallerstein's world-systems theory. Walerstein divides world into 3 tiers: core, periphery, and semiperiphery. Division helps explain interconnections among places in the global eco. Core processes generate wealth in place bc require higher levels of edu, more sophisticated tech, and higher wages and benefits. When core processes embedded in place, wealth generated for peeps in place. Peripheral processes require little edu, lower tech, and lower wages and benefits. Producing ag by hand using little tech may generate stable food supply in place, but doesn't have signif impact on larger formal econ.

Neocolonialism-

Economic and financial policies that give higher income countries and organizations control over lower income countries. Term draws attention to continuing ability of form colonial powers to control econs of lower income independent countries. Historically, ideas bout gov and econ diffused from Eu through world as result of colonialism, global trade, and rise of capitalism. IR and colonialism made colones dependent on colonizers. Relationship bright wealth to colonizers. Even after colonialism ended, econ, political, and social networks made through colonialism persisted. Goods and capital continued to flow from colonies to former colonizers.

Explain How Development Is Defined and Measured:

Economic and social geo of modern world is patchwork of contrasts. Most peeps use terms developed to describe developed, contrast to Uzbekistan. Notions of development originated with IR and idea that tech can improve lives of peeps. Through advances in tech, peeps produce more food, make new products, and accrue material wealth. But these don't necessarily bring happiness, social stability, or enviro sustainability. Development can be narrow, sometimes controversial indicator of human condition. Whatevs the complexities, development has greater influence on places and peeps. Therefore important to understand dif approaches taken to measuring development and assessing its advantages and disadvantages.

Costs of Economic Development:

Economic development changes place. To increase productivity, whether industrial or ag, peeps transform enviro. As countries industrialize, air and water often become more polluted. Pollution not confined to industry. Pesticides and herbicides that used in intensive ag have neg impacts on soil and groundwater. Tourism can be as difficult on enviro bc taxes existing infrastructure beyond its capacities. Costs of tourism often stretch beyond enviro, affecting ways of life and fundamentally altering cultural landscape.

Formal Economy-

Economic productivity in agriculture, mining, industry, and services that is counted or taxed by government. Trade is through formal channels, often using credit.

Maquiladora-

Foreign-owned factories in Mexico where low-wage workers assemble imported components and raw materials into finished products for export. Mexican maquiladora plants produce goods like electronic equipment, electrical appliances, automobiles, textiles, plastics, and furniture. Plants are controversial in Mexico and US. Corps that relocated there avoid employment and enviro regs that are in force few miles to N. Many maquiladora factories hire young peeps for low pay, and few, if any benefits. Work in repetitive jobs, sometimes in enviro questionable conditions. In 1992, US, Mex, and Can established NA Free Trade Agreement (NAFTA), prompted further industrialization of border region. Nafta took effect Jan 1, 1994. In 2018, US-Mex-Can Agreement (USMCA) replaced NAFTA, but not much changed. Violent crimes remains serious prob in Ciudad Juarez, even as El Paso remains comparatively safe. Slums of Tijuana world apart from much of San Diego. In Ciudad Juarez and Tijuana, Mexican drug cartels compete for control, making instability in N mexico. Instability makes econ development more difficult. In response, Mexicans continue to migrate to US, despite tightly controlled border.

Describe the Nature and Limitations of Development Models:

Governments, nongovernmental organizations, and international financial institutions (including the World Bank, World Trade Organization, and International Monetary Fund) use a variety of development models to understand how and why countries develop. Models, which seek to explain how countries move along path to development, influenced development policies round world. But most of them have Western bias. Assume that development occurs when strategies led to development in Eu and NA are pursued elsewhere. But, Western-inspired measures don't always have positive effects. Some designed to improve development in lower income countries, like attracting industry and mechanizing ag can lead to worsening social and enviro conditions for many.

Digital Divide-

Growing gap in access to Internet and communication technologies between connected and remote places. Nonprofit and nongov development agencies, including one called Living Cities, called mobile phone "great equalizers." But evidence mixed. In 2014 study, analysts surveyed residents of 24 middle-income countries. Found that while cell phones are almost omnipresent in many nations, most peeps still offline. High degree of correlation between income and internet access means instead of mobile phones equalizing internet access for higher and lower income countries, each can reinforce or exacerbate digital divide between rich and poor. Survey also confirmed that peeps with college edu more likely to have smartphones and mobile access to internet.

Costs of Tourism: 3

Growing recognition of cult and enviro impacts of tourism led to rapid growth of ecotourism. Ecotourism focus primarily on fragile natural areas; goal is to organize small-scale tourist experiences that involve minimal enviro disruption and that are sensitive to well-being of local peeps. Goal is to build enviro and cult awareness and respect. Many pepes see ecotourism as positive alternative to mass tourism. Still, ecotourism doesn't avoid all enviro and social costs of mass tourism. Most ecotourism operations foreing owned, there are enviro costs to bringing peeps to remote areas and showing them around, and presence of outsiders inevitably influenced lives of local peeps. Associated cult landscape frequently study in harsh contrasts in tourism. Gleaming hotels tower over modest, often poor housing; luxury liners glide past poverty-stricken villages; opulent meals served in hotels while, down street, kids suffer from malnutrition. If tourist industry offered real prospects for sustained econ progress in low-income countries, like circumstances might be viewed as temp, unfortunate byproducts. But, in many cases evidence points in other direction.

Costs of Industrialization:

In efforts to attract new industries, many govs in periphery and semiperiphery set up special manufacturing export zones called export processing zones (EPZs) or special economic zones (SEZs). These zones offer favorable tax, regulatory, and trade arrangements to foreing firms. By 2006, 130 countries had established 3500 zones and many had become major manufacturing centers. 2 of best known zones are Mexican maquiladoras and special econ zne of China. Gov locate zones in places with easy access to export markets. Maquiladora zones in Mexico mainly stied directly across border from US, and special econ zone of China located near major ports. These zones typically attract mix of manufacturing operations. Depending on skill levels of labor force and available infrastructure.

Costs of Tourism: 2

In many instances, tourism fosters demonstration effect among locals that encourages them to behave in ways that may please or interest visitors, but viewed neg by local community. Tourists build expectations of what will see and how will experience local cults, which makes ideas of authenticity that may or my not exist. Local cults constantly change and communities and peeps within a culture may behave dif or have dif vales than authentic ideal made and reinforced by tourism. Some tourism workes considered employment in tourism industry degrading bc demands performances of cult to meet others expectations and displays of seviete to tourists that locals find offensive. Flood of affluent tourists may be appealing to gov of lower-income country whose elite financial stake in hotels where can share pleasure of wealthy. But local entrepreneurs have difficulty tapping into tourist revenues. Powerful multinational corps and national govs limit opportunities of local, small-scale operators. Instead, favor mass, prearranged tourists destinations that isolate tourists form local cults and communities. Overreliance on tourism can also leave econ vulnerable if shifting econ circumstances cause sharp decline in num of tourists, or if natural disasters hit.

Costs of Agricultural Intensification

In peripheral countries, ag typically focuses on personal consumption or production for large ag conglomerates. Where zones of larger-scale, modernized ag developed in periphery, foodstuffs produced for foreign market and often have minimal impact on impoverished conditions of surrounding areas. Little is produced for local market bc distribution systems poorly organized and many locals unable to pay for foodstuffs. Turn to commercial ag can have multiple econ, social, and ecological effects. Most traditional farmers work small, fragmented plots of land, and what they produce doesn't generate much income. Even on larger pots of land, many farmers only have access to simple tools and equipment. Tend to grow grains, root crops, and fruits and vegs. Yields per unit area low, subsistence modes of life prevail. Introduction of large-scale commercial ag into mix can make more difficult for small-scale fares to compete in sale of products. Don't often have access to fertilizers and pesticides used in commercial ag. Social relations often strained too. There are major wealth disparities between few who benefit from ag modernization and many who don't. Still, combination of expanding land devoted to commercial ag and worsening econ conditions for traditional farms can push these farmers into more marginal lands.

Islands of Development:

In periphery and core, govs often invest heavily in expanding econ of capital city so it can act as showcase for country. Capital cities home to gov buildings and jobs. Often house university, museums, heritage centers, convention centers, and headquarters of large corps. After gaining independence, many former colonial states spent lavishly on capitals. Such spending not essential to political or econ success, but money spent bc states wanted to showcase their independence and future potential. Wanted to make national treasure. Eu colonies provide model that was followed elsewhere, having themselves already directed sigif wealth in earlier times to building grand capital cities: US London, France Paris, and Netherlands Amsterdam. In many countries of global econ periphery and semiperiphery, capital cities by far largest and most econ influential cities in state (ie primate cities). Some newly independent states built new capital cities away from colonial headwaters to separate themselves from colonisers. Cities meant to bring together diverse groups and reflect common cult. Econ development might begin to extend to interior of state, or help establish control over region with pop whose loyalties to state might be in question. Corps can also make cities focal points of development by concentrating corp activities in particular places. Often, corps build up cities near resources are extracting or near manufacturing centers have built. Multinational oil comps make subsidiaries in countries of periphery and semiperiphery, making or expanding cities near oil reserves. Ex, Elf and Shell, two oil comps based in Eu but with major operations in Gabon, run ElfGabon and ShellGabon in Central African country. The oil comps took the small colonial town of Port Gentil and turned it to city that locals call "oil city." Oil comps built housing, roads,and stores, and gave much of employment in town.

Political Corruption and Instability: 2

In places where poverty rampant. Politicians often become corrupt, misusing aid and exacerbating plight of fams with lower incomes. In low income countries, compromised leaders can stay in power for decades. Circumstances and timing need to work together to allow new gov to come to power. When gov become excessively corrupt, other countries and nongov orgs sometimes withdraw development aid to country. But hwn happens, everyday peeps often bear brunt of hardship. Even when aid provided, sometimes mismanaged, and almost never sufficient to meet basic needs or reverse trajectory of hardship.

International Financial Institutions: Chinese: 1

In recent years, World Bank and IMF backed away from some of more controversial lending practices- showing greater concern for social and enviro implications of development funds. But with rise of China, development finance is no longer primarily Wern gae. In 1994, China Development Bank established under Chinese gov. Since then, variety of other Chinese banks with international reach come on scene, turing China into major player in international development arena. 4 largest banks in world measured by total assets are Chinese. Biggest bank in world is ICBC (Industrial and Commercial Bank of China), followed by China Construction Bank, Agricultural Bank of China, and Bank of China. These banks called "Big Four" and owned by holding comp that is owned by the gov of China. Big Four banks locations all over world. China Development Bank and Export-Import Bank of CHina also now provide as much development financing to less developed countries as World Bank does. China's development funding is appealing to many countries bc they see loans as having no strings attached- loans don't require govs to follow structural adjustments. While Chinese development funding helping meet infrastructure needs of many countries, heavy emphasis on large infrastructure and energy projects (coal-burning power plants and large dams designed to produce hydroelectricity) means that Chinese development assistance carries with it serious enviro costs. IN Bangladesh, ex, Chinese-financed coal plants worsened air pollution and made health probs (to say nothing of their contribution to global climate change). And large Chinese-financed hydroelectric plants along Mekong River reduced fish stocks and threatened peep's livelihoods. While Chinese development loans come without strings attached in terms of having to change gov operations, came with serious financial and political consequences when borrowers become trapped in debt and can't repay loans. Each investment in China's Belt and Road Initiative (BRI) benefits China. Bv Chinese comps built porj, they hire workers, and Chinese workers instead of locals, depriig locals of construction jobs.

International Financial Institutions: Western: 1

International financial institutions make assumptions, guidelines, policies, and structures for development. As WWII was winding down, allied powers met Bretton Woods (New Hampshire) to draw up plan for postwar econ world. Out of conference came World Bank and International Monetary Fund (IMF)- international financial institutions aimed at promoting economic reconstruction, free trade, and stability in global financial system. World Bank initially focused on rebuilding Eu and become major source of development funds for lower income counties. IMF tasked with monitoring currency exchange rates and balance of payments in trade to make financial stability in global markets. US and Eu are dominant donors and influences of World Bank and IMF. Pres of World Bank always an American, and pres of IMF always Eu. IMF and World Bank loaned substantial amounts of money to newly independent countries in Africa and Asia after WWII. Loans typically been earmarked for large infrastructure projects like dams, highways, and airports. Countries receiving loans generally able to repay them til world econ took downward turn 1970s. Price of oil rose, and by early 1980s commodity prices dropped. Rising oil prices make production of goods more expensive, and falling commodity prices make difficult to repay loans as value of exports decines. The Third World Debt Crisis began as export revenue declined, the cost of oil increased, and state-run companies made in 1960s and 70s found to be inefficient and drain on gov funds.

Alternative Measures of Development: 1

Limitations of GNI promoted analysts to look for alternative measures of econ development, ways of measuring roles that tech, production, ranrptation, and communications play in econ. To measure use of tech, can look at num of workers relative to amount of production in given sector. In conventional development terms, country with high % of laborers engaged in production of ag less developed than one with high % of workers involved in high-tech industries. Productivity per workers examined by summing production over course of year and dividing by total num of persons in labor force. Good measure of access to tech is access to railways, roads, airports, phones, raidos, tv, ect. Large difs in communications access, including access to Internet, mobile cell subscriptions, and phone landlines round world. World average for internet and mobile access increasing, while world average for landline is decreasing.

World-Systems Theory: 2

Nother benefit of 3 tier structure is focuses on how good is produced instead of what's produced. Rostow looked at what's produced. Argued that to develop, country needs to move from traditional ag production to industrial production. Wallerstein argued that country can produce ag using core processes and gain wealth while nother country can produce same ag product with peripheral processes and gain almost no wealth. Nother reason why some geos drawn to world-systems is its potential applicability at multiple scales.

Dependency Ratio-

Number of people not working age (0-14 and over 65) relative to number of people working age (15-64). Nother way to measure development is to compare size of working-age pop with num of older or younger peeps in society who aren't contributing to country's econ. Resulting dependency ratio measures proportion of dependents in pop relative to every 100 peeps of working age.

Core-

Places in the world economy where core processes dominate.

Semi Periphery-

Places where core and periphery processes are both occurring; places that are exploited by the core but in turn exploit the periphery.

Neoliberalism-

Policies based on the economic theory that government should not intervene in markets. Structural adjustment loans were part of larger trend toward neoliberalism in late 20ct. It is a variant of the neoclassical econ idea that gov intervention into markets is inefficient and undesirable. Neoliberalists resist gov intervention wherever possible. That way of thinking was at heart of structural adjustment conditions that were attached to loans and refinancing progs. Neoliberal ideas spurred trend toward transferring econ control from states to private sector. As result, size of public sector in num of counties shrank. Corp control expanded and state and regional govs had less control over econ destinies.

Political Corruption and Instability: 1

Political corruption and instability greatly impede econ development. In peripheral countries, wide divide often exists between v wealthy and poorest of poor. In Kenya, ex, wealthiest .1% have more wealth than bottom 99.9%. Disenfranchisement of poor and competition among rich for control of gov can lead to extreme political instability in state. Kenya experienced this prob in 2007-2008 where roughly 1300 peeps died as result of violence round pres election. Kenya's pres election in 2017 proved less violent, but still controversial. After high courts found irregularities in vote, new elections went forward. Incumbent pres, who had lost in earlier annulled vote, ended up retaining pres only after opponent withdrew. Many countries in periphery and semiperiphery struggled to establish and maintain democracies in wake of decolonization. Gov that emerged often reflected political and social hierarchies of colonial period. Some failed, some overthrown by military coups, and some saw power fall into hands of dictatorial strongman. Many countries in periphery and semiperiphery alternated repeatedly between quasi-democratic and military govs. Some argue that without considerable wealth, maintaining liberal democracy all but impossible. Looking at international news on any given day will reveal story somewhere that demonstrates link between econ stability and political stability. In Afghanistan, eocn woes present one of greatest threats to stability of US-supported gov in Kabul. More than 1.2 of pop is impoverished. Gov also lacks funds to invest in development. Foreign aid provided some help, but flow of aid been variable and amount insufficient to address country's searching econ probs. Many analysts see this as key impediment to achieving stability Afghanistan. Poverty helps Taliban.

Informal Economy-

Portion of the economy that is not taxed or regulated by government. Goods and services are exchange based on barter or cash systems, and earnings are not reported to government.

Evaluate How Political and Economic Institutions Influence Uneven Development Within States:

Poverty not confined to periphery. Core countries have regions and peeps that markedly poorer than others. On Pine Ridge Indian Reservation in N Great Plains, unemployment at 80% and American Indians on reservation live in poverty, with per capita of under $8,000. Other countries of core have similar regions where peeps econ lives don't improve when country's econ grows. In Eu, areas of isolation and stagnation persist- particularly in E. At same time, some areas within peripheral countries experiencing rapid econ growth. In each these cases, local conditions differ markedly from those found in surrounding areas. Regional contrasts in income reminder that per capita GNI doesn't capture important aspects of econ development. Any statstc that derived for entire country hides econ variations within country. Periphery countries marked by severe regional disparities. Contrast between higher income and lower income within cities of C and S America and Africa. When viewed at scale of state, major cities (particularly capitals) and surroundings often look like islands of prosperity. Modern buildings, factories on outskirts, and modern farms tend to be nearby. In some cases, roads and rails lead to bustling ports, where luxury automobiles unloaded for use by privileged elite, and raw materials or ag products from country exported to points round world. In core areas within peripheral countries, rush of progress may be evident. If travel few miles into countryside ro dif neighborhood, though, will see dif pic.

Microcredit Programs-

Practice of giving small loans to individuals, who operate within a community of other borrowers, to start businesses and cottage enterprises. One type of NGO progman that has found some success in less prosperous counties is the microcredit program. The idea behind a microcredit program is to give loans to people with low incomes, particularly women, to encourage development of small businesses. Programs either have women in the village guarantee each other's credit, or they make future lending to others contingent on repayment by the first borrowers. With repayment rates hovering 98% the progs can finance themselves, and many NGOs offer such progs. By providing mcirocerdit to women, NGOs can alter the gender balance in region, giving more fiscal power to women. Some microcredit progs credited with lowering birth rates in parts of developing council and lathering social fabric of cults by empowering women. Successful microcredit progs also help reduce malnourishment, and women with incomes can feed themselves and kids. Microcredit progs been less successful in places with high mortality rates from diseases like AIDS. If borrower unable to work or if fam has medical and funeral bills, borrower much more likely to default on microcredit loan. Peeps in poorest parts of periphery experience multitude of challenges. These include, but not limited to, disease, corrupt govs, high mortality rates, high fertility rates, and disruptions form natural hazards. When peeps in periphery experience one or more of these challenges, goal of eon development takes back seat to daily survival.

Nongovernmental Organizations (NGOs)-

Privately funded institutions that aid in development and relief work. One of greats challenges to development is making development opportunities outside of island of development. In most rrtla, impoverished regions of lower income countries, some nongov orgs try to improve plight of peeps. NGOs to run by state or local govs, instead operate independently and term usually reserved for entities that are nonprofits. 1,000s of NGOs operate in world today. Each NGO has its own set of goals, depending on the primary concerns outlined by its founders and finance. Some coutnesi have so many NGOs operating within them that they serve as a parallel state, finance by foreigners and accountable to nobody. Ex, 1,000 of NGOs operate within country of Bangladesh at any time, focusing mainly on rural areas and villages of state. But NGO phenomenon can mask depth of probs some places face. In wake of 2010 earthquake in Haiti, one respected British newspaper reported was approximately one NGO per 1000 peeps in Haiti, but that much of money funneled through these NGos never reached the peeps most affected by the earthquake.

Traditional Models: 2

Rostow's development model doesn't pay much attention to different geo and historical circumstances that can affect what happens to places. Instead it treats countries as individual, autonomous units that simply move through process of development at dif times and dif speeds. Fails to consider ability of some countries to influence what happens in other countries or dif positions countries have in world econ. Rostow's model also led many peeps to think of world as divided into 2 basic econ realms: "developed" and "less developed." Those countries moving from 2nd to 1st category were termed developeng, and term came to be used more widely in late 1960s and 1970s as some lower income countries began to advance economically. Before long, all countries that weren't viewed as developed were developing. Using term developing, though, implies that countries are improving along each indicator of development: increasing per capita GNI, increasing productivity per worker, improving access to communications and tech, improving access to health care and clean water, and improving literacy rates for males and females. Rostow's Model; still influential, despite all limitations. Even calling higher income countries "industrialized" and saying that lower income countries need to "industrialize" implies stages of development. Suggests that econ development can be achieved only by climbing same ladder of devotion that higher income countries already climbed. But of lower income curry quickly industrialized today through foreign investment, and might not reap much econ benefit. Could experience severe econ consequences. Higher income countries called industrial today are postindusreial. Decreasing transportation costs and new approaches to production moved manufacturing of goods to other parts of world. Many of highest income counters have econs built on service sector, not industrial sector.

Traditional Models:

Rostow's model assumes that all countries follow similar path to development or modernization. Advancing through 4 stages of development. In 1st stage, society is traditional and dominant activity is subsistence farming. Social structure is rigid and tech is slow to change. 2nd brigns preconditions of takeoff. New leadership moves country toward greater flexibility, openness, and diversification. These changes lead to 3rd stage, takeoff. One country experiences something akin to industrial rev, and sustained growth takes hold. Urbanization increases, industrialization proceeds, and technological and mass-production breakthroughs happen. Next, econ enters 4th stage, drive to maturity. Tech diffuse, industrial specialization happens, and international trade expands. Modernization evident in key areas of country and pop growth slows. Finally, some countries reach final stage, high mass consumption, marked by high incomes and widespread production of many goods and services. During stage, majority of workers enter service sector of econ. Nother name of model (and other models derived from it) is ladder of development. Visually, can see his 5 stages of development as rungs on a ladder, with each country climbing the ladder one rung at a time. The major limitation of Rostow's model is that it provides no larger context for development. Is a climb up the ladder largely dependent on what happens within one country? Or do we need to take into account all of other countries, their places on the ladder, and how their actions and global forces affect individual country's movement on ladder? Theory also misses particular conditions that can influence development decisions within individual country, with no consideration of role that cultural or political differences might play.

Desertification-

Spread of desert like conditions to semiarid lands due to overuse or misuse of land and water resources. Ecological effects of latter tendency can be severe. Soil erosion commonplace in many peripheral areas. Severe soil erosion in places with dry or semiarid climates round desert results in extreme degradation of land and spread of desert into these lands. Though expulsion and contraction of deserts can happen naturally and cyclically, process of desertification often results from humans destroying native vegetation and eroding soils through overuse of land for livestock grazing or crop production.

Commodity Chain-

Steps in the production of a good from its design and raw materials to its production, marketing, and distribution. Manufacturing-oriented transnational corps also influenced development through globe-spanning production networks they established. To understand how production of goods makes weather in some areas but not others, useful to understand concept of commodity chain and role that places play in chain of production. Commodity chain is series of links connecting many places of production and distribution that are involved in creation of final product that's bought and sold on market. Commodity chains today span globe, and break-of-bulk locations only one of many nodes along chain. Places occupy dif niches along commodity chains, and don't all benefit equally from production of good. Generation of wealth depends on how production occurs at each step and who reaps most of econ benefits from production. Sophisticated tech, high skill levels, extensive research and developments, and high salaries tend to be associated with segments of global commodity chains in core. Segments located in periphery, by contrast, tend to be associated with low tech, less edu, little research and development, and lower wages.

Per Capita GNI-

The Gross National Income of a given country divided by its population. To compare GNI across countries, economists must standardize data. Most common way to do so is to divide it by pop of country, which yields a per capita GNI. IN Japan the per capita GNI in dollars in 2017 was $38,550. IN US it was $58,270. IN Norway $75,990. India $1870, Nigeria $2190, and Indonesia $3540. Enormous range in per capita GNI reflects wide gap between rich and poor.

Context-

The physical and human geography creating the place, environment, and space in which events occur and people act. Development happens in context. To understand why some countries are poor and others are wealthy, need to consider role played by geographical context: the spatial organization, character, and history of a place and its interactions with the border world.

Structuralist Theory-

Theories based on the idea that difficult-to-change, large-scale economic arrangements shape what is possible for a country. Develionet scholars produced num of alternative theories to explain barriers to development under colonialism. These theories called structuralist theories. World econ has set of structural circumstances that make it v difficult for lower income countries to improve their econ sitch. Such circumstances include concentration of wealth in certain areas and unequal relations maong places. Structuralists argue that less well-off countries face v dif set of development circumstances and dif contexts than those faced by courtesy of W Eu that were desired in Rostow's model. Some even question whether possible for all countries to develop at same time or if structural circumstances require that some countries be on bottom for others to remain on top.

World-Systems Theory-

Theory originated by Immanuel Wallerstien and illuminated by his three-tier structure, promising that social change in and economic wealth in the periphery is inextricably linked to the core. Development models- even dependency theory- tend to underplay geo, historical, and political context. In reaction to that tendency, some geos embraced development theory already encountered: Immanuel Wallerstein's world systems theory. Incorporates attention to role that space (geo) dn time (hist) play in power relationships that exist in world econ.

Modernization Model-

Theory that countries follow the same path along stages of development. Developed by economist Walter Rostow. The most influential classic development model is this. Many theorists of development grew out of major decolonization movements of 1960s. Motivated by concern with how dozens of newly independent countries in Africa and Asia would survive economically, Rostow looked at how countries were already econ powerful in 1960s gotten where they were.

International Financial Institutions: Chinese: 2

When countries can't repay loans from BRi projs, gov of China steps in and takes ownership. While Chinese loans don't have official strings constraining gov, Chinese investors worked to influence electron outcomes in borrower countries. In Sri Lanka, Chinese financial institutions contributed least $7.6 mil to Rajapaska's 2015 campaign. Internal investigation in Sri Lanka found that checks from account controlled by Chinese port development project paid for gifts to voters and supporters and 2 checks totalling $1.7 mil which were delivered by volunteers to Rajapaska's home. He lost the 2015 election but became politically active, along with brother, in 2018. Chinese investment ratcheted up almost immediately, with Ritz Carlton and JW Marriott hotels financed by Chinese comps going up next to port. China's BRI projs, global influence of Chinese banks, and Chinese developments organizations chain structures and face of global econ development. Impacts of development financing-whether from Chinese or Western sources- won't be same everywhere. Conditions within countries matter. Lack of edu, poverty, corrupt leadership, political instability, and disease can hamper development, Possible to get into chicken or egg debate: Did interconnections that characterize world econ make these conditions or these conditions help make structures of world econ? Many peeps think that neither argument can stand alone, but understanding both is important.

Dollarization-

When one country abandons their local currency and officially adopts the currency of another country. Other types of dependency are important too. Though US didn't colonize Central and S America, several counties in region now recognize that their econ is dependent on US and explicitly link their econ to US dollar. More than 40 countries round world peg value of their currency to US dollar, and 10 countries have abandoned their currency and completely adopted US dollar. Like modernization theory. Dependency theory based on generalizations bout econ change that don't pay attention to geographical difs in cult, politics, and society. Not every country is in same sitch at same time, so countries can't all follow same path of development, as modernization theory would have it. Likewise, not every country is affected by dependent relationships in same way. Pegging currency to or adopting currency for higher income coury may be beneficial for one coury but not for another.

International Financial Institutions: Western: 2

World Bank and International Monetary Fund stepped in to lend more money to help borrower countries out of the debt crisis. These loans came with conditions. Borrower countries had to agree to implement econ and gov reforms, including privatizing gov entities, opening themselves to foreign trade, reducing tariffs,and encouraging foreing direct investment. These loans known as structural adjustment loans. By early 1990s, the set of policies associated with them came to be known as Washington Consensus. Opponents of consensus argue that policies support and protect core counties econ at expense of peripheral and semi peripheral econs. Countries had limited options to reject structural adjustment loans bc cost of servicing debts (repayments + interest) often exceeded revenues from export of goods and services. Borrower countries also needed to demonstrate that they were repaying their debts and restructuring their econs. Intention was to attract multinational corps that could offer implement to their peeps and investments in their econs.