Geography (0460) | Development

Welcome to Theme 3: Economic Development!

Hello Geographers! This chapter, Development, is central to understanding how the world works. It’s about more than just how much money a country has; it’s about the health, education, and quality of life for its people.
We will learn how to measure how 'developed' a country is, explore different job types, and see how the world is becoming more interconnected through a process called globalisation.

Don't worry if some terms seem complicated—we'll break them down using simple examples!

Section 1: How We Measure Development (Indicators)

To assess a country's level of development, geographers use various tools called indicators. These help us compare countries and track progress over time. We can categorize indicators into economic (money-related) and social (people/lifestyle related).

1.1 Economic Indicators of Development

These measure the wealth and income generated by a country:

• GNP per capita (Gross National Product per capita):
  This is the total value of all goods and services produced by a country in a year, plus the income earned by its residents from overseas, divided by the total population.
  In simple terms: It’s the average slice of the national income pie that each person gets.
• Common Mistake to Avoid: GNP per capita is an average! It doesn't tell you about the wealth distribution (how many rich versus how many poor people there are).

1.2 Social Indicators of Development

These focus on the quality of life and human well-being:

• Life Expectancy:
  The average number of years a person is expected to live.
  High life expectancy (e.g., over 80 years) often indicates good healthcare, clean water, and stable food supply.
• Literacy Rate:
  The percentage of adults who can read and write.
  A high literacy rate suggests a well-funded education system and contributes to a skilled workforce.

1.3 Composite Indices: The HDI

Sometimes, just using one indicator (like GNP) isn't enough, as it can be misleading. A composite index combines several factors to give a more balanced picture.

• Human Development Index (HDI):
  The HDI is the most common composite measure. It combines three key areas:
  1. Health: Measured by Life Expectancy.
  2. Education: Measured by literacy and average years of schooling.
  3. Wealth: Measured by GNP per capita.
  Memory Aid: Think H-D-I = Health, Dollars, and Instruction (education). Countries with a high HDI (closer to 1.0) are considered highly developed.

1.4 Identifying and Explaining Inequalities

Development is not evenly spread. We see significant differences:

• Inequalities Between Countries:
  This is the gap between richer, more developed countries (MEDCs) and poorer, less developed countries (LEDCs). For example, the GNP per capita in Switzerland is vastly higher than in Sudan.
• Inequalities Within Countries:
  Even within a single country, there can be massive gaps between different groups or regions.
  • Urban vs. Rural: People in cities often have better access to jobs, education, and healthcare than those in remote rural areas.
  • Gender/Ethnic: In many countries, certain groups (e.g., women or minority ethnic groups) may have lower literacy rates or employment opportunities than others.
  • Example: In many LEDCs, the business district of the capital city might look highly developed, but just a few kilometres away, people might live in squatter settlements with poor services.

Section 2: Economic Sectors and Employment Structure

To understand how an economy works, we categorize jobs into different sectors of production.

2.1 Classifying the Four Sectors

All economic activity falls into one of these four categories:

• 1. Primary Sector:
  Involves gathering raw materials directly from the Earth.
  Illustrations: Farming, fishing, forestry, mining, and quarrying.
• 2. Secondary Sector:
  Involves manufacturing and processing raw materials into finished or semi-finished goods.
  Illustrations: Car assembly, clothing factories, food processing, construction.
• 3. Tertiary Sector:
  Involves providing services to people and businesses. This is sometimes called the 'service sector'.
  Illustrations: Teaching, banking, tourism, retail (shops), transport, healthcare.
• 4. Quaternary Sector:
  A specialized part of the Tertiary sector, focusing on information, research, and high-tech knowledge-based services.
  Illustrations: Scientific research and development (R&D), IT consultants, software design.

2.2 Employment Structure and Development

The proportion of the workforce employed in each sector (the employment structure) changes dramatically as a country develops.

The Shift in Employment:

1. LEDCs (Low Development):
   A very large percentage of people (often over 50%) are in the Primary Sector (subsistence farming). There are few jobs in manufacturing or high-level services.
2. NICs (Newly Industrialising Countries):
   As the country industrialises, the Secondary Sector grows rapidly (manufacturing boom). The Primary sector shrinks, and the Tertiary sector starts to expand to support industry.
3. MEDCs (High Development):
   The Tertiary and Quaternary Sectors dominate (often 70-90% of jobs). The Secondary sector is often outsourced to NICs, and the Primary sector employs a tiny number of people due to high mechanisation.

Analogy: Think of a poor country as starting with a focus on 'planting seeds' (Primary) and a rich country focusing on 'managing the data' (Quaternary).

Section 3: Globalisation and Transnational Corporations (TNCs)

The modern world is increasingly interconnected—economically, politically, and culturally. This process is called globalisation.

3.1 Defining Globalisation

Globalisation is the process by which the world is becoming a single economic and cultural unit due to increased trade, movement of capital, and rapid spread of information.

3.2 Factors Giving Rise to Globalisation

Several factors have made globalisation possible:

• 1. The Role of Technology:
  Improvements in IT (internet, mobile phones) and communication technology mean people and businesses can communicate instantly across the globe. This allows companies to manage operations spread across many countries.
• 2. Advances in Transport:
  The use of large container ships and faster air freight makes moving raw materials and finished products cheaper and quicker than ever before.
• 3. Transnational Corporations (TNCs):
  These are large companies that operate in multiple countries. Examples include Apple, Coca-Cola, and Nike. TNCs drive globalisation by investing money, building factories, and selling products globally.
• 4. Economic Factors & Government Policies:
  Many governments now promote free trade (fewer taxes/tariffs on imported goods) and have removed restrictions on foreign investment, making it easy for TNCs to move production overseas.

3.3 The Impacts of Globalisation

Globalisation has profound effects everywhere it touches—both positive and negative.

Positive Impacts (Benefits):

• Local/National: TNCs create jobs in developing countries (providing income and skills) and invest in local infrastructure (roads, power).
• Global: Increased trade leads to lower consumer prices globally and greater economic interdependence, which can reduce conflict.

Negative Impacts (Problems):

• Local: Local companies struggle to compete with TNCs and often go out of business. Factory workers in LEDCs may face poor working conditions or low wages.
• National: TNCs can sometimes use their power to pressure governments for tax breaks. If a TNC decides to move its factory, thousands of jobs can be lost instantly (economic vulnerability).
• Global: TNCs often contribute heavily to environmental pollution, and the spread of global culture (Western food, media) can lead to the loss of unique local traditions and languages (cultural homogenisation).

3.4 Case Study Requirement: A Transnational Corporation

For your exam, you must have a case study of a specific TNC and its global links.

• What you need to know: Where the company is headquartered (origin), where its manufacturing is done (processes), and where its products are sold (markets/outputs).
• Focus on the Impacts: You should be able to describe the benefits (e.g., jobs) and disadvantages (e.g., poor wages, pollution) that this specific TNC brings to the countries where it operates.