World economic development: measurement and problems ~ Civil Services Self Study

World Economic Development

Whatever we are seeing in development today is not a sudden development, it happened in stages, as per Rostow's " Economic development model", there are five stages of development that a country passes through, five stages are:

Traditional Society is dominated by agriculture and religion.
Preconditions for take-off, small progress of the middle class
take off, industries are being set up in some regions.
Drive to maturity, fully industrialized
Stage of mass consumption, self-reliance, and move to automation

We will discuss later in detail the above model in the models/ theories section.

The above five-stage of Rostow is very true in the present world. Some countries like Sudan & Somalia are in stage first and countries like Japan & the USA are in stage five. The reason behind this development disparity in the world can have many factors.

Problems in economic development

Problems /factors in economic development

Historical factor:

Some culture is against materialism, for example, even today, tribal people in India did not believe in a materialistic society.
Colonial loot is also a factor behind the backwardness of the country, for example, India

Demographic:

Skilled labor required for industries, low quality of education & health, overpopulation, and immigration also hinder the development progress.

Environment:

Climate change is costing huge to low lying countries such as Indonesia
Disaster-prone areas such as the coastal area of Odissa also lacking in development

Political factor:

Political stability is needed for the development of countries. Due to political instability in Afghanistan, Sudan & Syria, development has stopped.

Economical factor:

Low savings, low per capita income, and poverty hinder the capital formation and delayed economic growth.

Innovation & Technological advancement:

Israel and Japan are the best examples. Despite resource scarcity, they are now developed due to technological advancement. Israel invented drip irrigation and cheap desalination technology, and environmental factors are not able to limit the agricultural growth of Israel.

Measurement of Economic Development :

The following diagram shows the measurement tool of economic development

Today, the level of development of the countries is estimated by per capita income. Based on per capita income, the nature of the economic model, and sectoral contribution to the GDP of the country, countries can be divided into the following type:

Developed country:

The following character:

High per capita income & expenditure
High level of living standard
High urbanization
The contribution of industry & service sector in GDP is more than 90 %
The large share in the world trade, both in import & export.

Undeveloped country:

They are moving from:

Agriculture sector dominance in industry & service
Poor to middle class to the higher class
Very small share in world trade

Previous year's question asked in UPSC mains geography optional paper

Examine the world patterns of industrial development and explain the problems of industrial development at national levels. (1991, 15 marks)
How far do the patterns of economic development and those of human development correspond with each other in the world? Illustrate your answer with examples. (1999, 15 marks)