64 terms

Geography: Disparities in Wealth and Development

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GNI (Gross National Income)
All the money a country makes per year from economic activity.
Monetary
Things related to money.
GNI Per Capita
A country's GNI divided by the amount of people.
HDI (Human Development Index)
Measures wealth, health and education.
Components used to calculate HDI
Health : Life Expectancy
Wealth: GNI Per Capita
Education: Average years of schooling
Indices
Measurement of development quality of health/life.
Life Expectancy
Average age a person in a country is expected to live.
Problems of Monetary Development Indicators
Inaccurate (cannot measure income gap), does not measure the quality of life.
Reason why the HDI is a good development indicator
It measures wealth, health, education and also the quality of life.
Reason why HDI is a mediocre development indicator
Does not take into account environmental factors, does not measure factors like human rights, gender and corruption.
North-South Socio-Economic Divide
A line that divides the socio-economically more developed north from the less developed south.
Reasons for the North-South Socio-Economic Divide
Climate differences, resources, governments are more organized and developed.
5 Stages of the Rastow Stages of Economic Development Model
Traditional society > Transitional stage > Take off > Drive to maturity > High Mass Consumption
RS Model: Traditional Society
Subsistence, barter, agriculture, low gender equality. (eg. Mali, South Sahara, Africa)
RS Model: Transitional Stage (starting to develop)
High-end LEDC, rural to urban, specialization, surpluses, infrastructure. (eg. Cambodia, Vietnam)
RS Model: Take Off
Industrialisation, growing investment, regional growth, political change. (eg. Malaysia)
RS Model: Drive to Maturity
MEDC, more gender equality, diversification, innovation, less reliance on imports, investments. (eg. UK, USA, Australia)
RS Model: High Mass Consumption (very developed)
Consumer oriented, durable goods flourish, service sector becomes dominant, low birth rates, high levels of education. (eg. Germany, Japan)
G20
20 most economic countries in the world. (eg. China, USA, Japan, Germany, Brazil, Canada, etc.)
Marginalisation
When a group of people become separated from society.
Polarisation
When there is a massive division between two groups.
Flaws associated with Development Indicators
Economic indicator (eg. internet connectivity, mobile ownership, income)
Social indicator (eg. birth rates, infant mortality, life expectancy)
Environmental indicator (eg. forest cover, pollution levels, biodiversity)
Absolute Poverty
When people don't have enough money to afford their daily needs. (earning less than $1/2 a day)
Relative Poverty
When people have less than the average in the community or country they live in.
Poverty Line
The minimum level of income deemed necessary to achieve an adequate standard of living in a given country.
Income Gap
The income gap between the richest and the poorest in a country.
Inequality or Disparity
When there is a difference in the way people are treated or paid or there is a difference in the amount of money and possessions they own.
Wants
Things that people like to have, but don't necessarily need.
Needs
Things that people need to survive.
Formal Economy
The sector of the economy that is taxed, monitored or regulated by the government. (included in a country's GDP, GNI, GNP)
Informal Economy
The sector of the economy that is not taxed, monitored or regulated by the government. (black market)
Unemployment
When people don't have a job.
Underemployment
When people are employed in a job below the skill/education level they are qualified for.
Benefits/Welfare
Money provided by the government to people that are unemployed, unable to work or earning a salary below the poverty line.
Distribution
The way things are spread out.
Factors causing Disparities in Wealth
Residence - where you can live can be important in determining your wealth.
Parental Education - if your parents are educated, it is more likely to mean they have a good job and can afford all of life's needs.
Religion/Ethnicity - some ethnic/religious groups can become marginalised and struggle to escape poverty.
Personal Education - if you have been educated you are more likely to get a job, stay healthy and become wealthier
Gender - in many societies males are still favoured over females.
Reason why many LEDCs have debt problems
Rising interest rates meant that loan repayments increased, lack of previous investment (generating very little income), low interest rates meant that poor countries were encouraged to take large loans from western banks.
Problems faced by LEDCs by having debt problems
Reduced investment in essential services like schools and hospitals, high levels of unemployment, problems of raising future capital (poor credit rating).
Cycle of Poverty
Economic decline > Low personal income > Less access to food and safe water > Hunger and poor sanitation > Disease, malnutrition and death > Depleted workforce
Core
Major part of a country which is economically and socially developed.
Periphery
Rural part of the country.
Reason why the core develop faster than the periphery
More investments from businesses and government, greater connection services and transportation.
Reasons for the increase of global life expectancy
More LEDCs are developing to MEDCs, improved medicine and healthcare, improved education.
Reasons for Educational Dispairity
Boys are favoured more than girls, some countries cannot afford to provide free education for everyone, in many LEDC countries children have to work instead.
Reasons why education is important to have socio-economic development
To have a better paid job, they will get health education to prevent diseases, higher life expectancy, making sure that girls and boys have equal education, better political systems.
Trade
The exchange of goods and services/ the exchange maybe for other goods and services but is normally for money.
Trading Bloc
A group of countries who have joined together to promote trade.
Imports
Goods and services purchased overseas on brought into a country.
Exports
Goods and services produced within a country and then sold overseas.
Protectionism
Attempts to protect domestic markets by making foreign goods less competitive.
Tarifs
Tax/duties placed on imported products to make them more expensive and reduce demand for them.
Free Trade
When trade is totally free and fair, no protectionist policies in place.
WTO (World Trade Organisation)
An organisation aimed at protecting free global trade.
Fair Trade
Does not produce goods itself, but instead lends its labels to companies that treat suppliers, host communities and the environment fairly and sustainably.
Benefits of Free Trade
Countries grow faster, jobs are created for local workers, gives local companies a chance to become global companies.
Benefits of Protectionism
Countries may become dependant on foreign countries, countries may become reliant on foreign workers, local companies will use more appropriate technology and take greater care of the environment.
HIPC (Heavily Indebted Poor Countries) Program
Debt relief for poverty reduction, started in the 1996.
Types of Aids
Emergency aid, development aid, tied aid, united aid, multilateral aid.
Advantages of Aid
Can help build expensive infrastructure products that wouldn't normally be built, after a natural disaster, food and medical aid can be vital in saving lives and cannot always be provided by the affected government, can help build schools and hospitals that improve the health and education of local populations.
Disadvantages of Aid
Countries can become dependant on money given by foreign donors instead of developing their own economy to become independent, food aid or worse food dumping can force local food production to collapse, might fund inappropriate and harmful technologies that cannot be sustained after aid has been removed.
Remittances
Money that is sent back to family and friends from economic migrants, usually living abroad.
Advantages of Remittances
Reduces unemployment, reduces pressure on schools and hospitals, migrants can return with new skills.
Disadvantages of Remittances
It can create dependency, creates family division and family pressure, remittances fall during economic downturn.
Factors of inequalities within countries
Education - boys are more favoured than girls
Wealth - massive division between groups, there are very rich and very poor people