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The economic theory of development UPSC


As per the economic theory, not only the climate but many factors are responsible for the development, the important factor for development are. 

  • Technology advancement:
    • Despite lacking natural resources in Israel and Japan. Both are developed counties because of technological advancement.
  • Capital formation:
      • Capital formation helps to invest in machines, research, and technology to boost development.
  • Demographic dividend:
    • Human resource is an important resource for any country for development as:
      • Humans can change things into resources.
      • can develop technology to increase productivity and efficiency.
    • A healthy and educated working population is key for regional or country development. 
    • A demographic dividend is favorable in India for development.
    • The aging population in European countries, Japan, the USA, and China is not favorable for their development.
  • Social and human capital:
    • Social peace and a large social network are key to social capital. 
    • Both social and human capital is the pivot for regional development.
    • Kerala is more developed than Bihar because of human capital.
  • Natural resources
    • Mineral resources can be brought from somewhere else but some basic natural resources such as water, soil, and mild climate are needed for development for the region.

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