Global Patterns of Economic Development (DP IB Geography)

Revision Note

Global Patterns of Economic Development

  • Development is a process of positive change where a country becomes wealthier and more technologically advanced

  • It refers to positive changes in people’s quality of life, such as happiness, educational opportunities, increased incomes, human rights, access to clean water and healthier living conditions

  • There are different strands of development:

    • Environmental - where natural environments are improved or restored

    • Political - where governments become stable and effective

    • Social - standards of living, access to health care, education, clean water, housing and leisure are improved

    • Economic - income, employment and industry is increased

Measuring Development 

  • Traditionally, measurements would focus on wealth, using indicators such as:

    • GDP - Gross domestic product is the total value of the economy per year

    • GNI - Gross national income is the total value of goods and services produced in a country per year

    • The poverty line - the percentage of people who earn less than $2.15 per day as set by the World Bank in 2022 (up from $1.90 per day in 2015)

  • This divided countries into rich or poor, but did not take into account the scale or change of wealth a country can move through

  • The World Bank categorises economies into income groupings per capita, in U.S. dollars: 

    • Low income countries (LICs) where average earnings are $1,135 or less

    • Middle income countries (MICs) - these are split into lower middle income of between $1,136 and $4,465 and upper middle income of between $4,466 and $13,845

    • High income countries (HICs) where average earnings are $13,846 or more 

  • Globally there is an uneven distribution of high, middle and low income countries

  • With 8 billion people in the world:

    • “Around 10% of the world’s population live in countries where the average income per person is less than $2 a day. Around 20% are in high-income countries. The majority, around 70%, live in middle-income countries - Gapminder 2023”

World Bank classification of countries by income groups 2021 

World map showing countries by income classification. High-income (purple), upper-middle (light purple), lower-middle (orange), and low-income (red). Labels for select countries. Key included.
Classification is based on a country’s GNI per capita and has changed over time 
  • Most HICs are found in the northern hemisphere and include countries such as Canada, Japan, Spain, UK and Japan

  • However, there are anomalies such as Chile, Australia, Uruguay and New Zealand, which are classified as a high income countries, but are located in the southern hemisphere and Haiti is the only country in North America that is classified as low income

  • Most LICs are found between the tropics and concentrated within Africa, along with some parts of Asia

  • MICs vary by:

    • Region

    • Size - physical and population numbers

    • Income levels

    • E.g.  Belize and the Marshall Islands have small populations, whereas the five BRICS countries - Brazil, Russia, India, China, and South Africa account for 27% of the world's land surface with 42% of the global population. China and India together account for approximately one-third of the world's population and are increasingly influential players in the global economy and Russia is the largest country by land mass at 11%

Classification of Economic Development

  • At an international level, the development of a country has been categorised into one of three groups:

    • Low income, developing country or less economically developed: 

      • A country with low human development (LHD) is a poor country. Most people have a poor quality of life with inadequate services and few opportunities

    • Medium income, newly industrialising or emerging economy; 

      • A country with high and medium human development (HMHD), a recently emerging country. Countries experiencing rapid economic growth and development based on industrial development. Incomes are rising and most people enjoy a reasonable standard of living

    • High income or more economically developed: 

      • A country with very high human development (VHHD). Countries that have modern industries and people enjoy a good standard of living with relatively high levels of income 

  • However, the categories do not account for varying levels of development at a local and national scale

  • There are differences between areas of the same city, the same country and between countries

    • Germany is more developed than Mexico, but Egypt is less developed than Mexico

  • The differences between levels of development is known as the development gap

  • Development is hard to measure accurately as it covers so many features 

  • It is measured using indicators 

Table of Indicators

Social Indicators

Economic Indicators

Political Indicators

These relate to strands such as:

Quality of life and social well-being

Equal opportunities, access to services such as education and healthcare

Life expectancy, birth control, education

Diversity, traditions and heritage

These relate to strands such as:

Employment, income and general wealth 

Savings, house building, house sales, consumer spending,
International trade


Resources, pollution controls and conservation

These relate to strands such as:

Effective governance, stability and integrity of governing bodies

Ease of trade, property rights, human rights, equality, and income guides

Corruption index

Measures of development

  • The traditional method of measuring wealth is through the country's GNP (gross national product), GDP (gross domestic product) and GNI (gross national income)

Methods of Measuring Development

Measure

Definition

Measure of...

Effect on Development

Gross Domestic Product (GDP

The total value of a country's output of goods and services produced in a given year

There is no way of knowing what the GDP is spent on: for example, GDP increases after an earthquake due to the rebuilding which is needed this does not mean that the country is more developed or that everyone's quality of life has improved

Economic - wealth


Higher

Gross Domestic Product (GDP) per capita

The total value of goods and services produced within a country in a year is divided by the population of the country. As this is an average, then any variation in wealth is hidden

There can be huge differences in GDP depending on the size and population of a country

Dividing it by the population means that more meaningful comparisons can be made between countries

Economic - wealth

Higher

Gross National Income (GNI)

Gross national income (GNI) is an alternative to gross domestic product (GDP) as a measure of wealth. It calculates income instead of output. It is, therefore, the measure of the total income received by a country from its residents and businesses regardless of whether they are located in the country or overseas

Economic - wealth

Increases

GNI per head

This is the total income of a country's goods and services, (including overseas income) divided by the number of people living in that country

Economic - wealth

Increases

Human Development Index (HDI)

This uses life expectancy, literacy rate, education level and GNI to calculate a country's score between 0 (least developed) and 1 (most developed)

Disparities between countries = social and economic

Higher

  • Individual indicators are misleading when used alone, as some features develop before others, which can suggest that a country is more developed than it is

  • By using multiple indicators (development continuum) as a measure of development, a clearer picture of that country's development is produced

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