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What is development?

Development: involves the change from small-scale, pre industrial societies, to largescale industrial societies. Also is the process by which societies change from
underdeveloped, through developing to developed societies.
How does population growth affect development?
Pessimistic:
-

Classical Malthusian model: human behavior governed by two natural laws


eat (subsistence) and reproduce) these natural conditions inevitable collide
population increases geometrically and subsistence increases arithmetically.
By this calculation, rate of population increases over the ability of a population
to feed itself. This creates: high levels of poverty and catastrophic
consequences.

Neo-Malthusian model: Erlich (1968) talked about the population bomb,


states that catastrophic outcomes are imminent: the battle to feed all of
humanity is over people will starve to death. Meadows (1972) said that at
some point, technological advances in food production would no longer sustain
a given global population uncontrolled, disastrous economic and political
decline.

Optimistic:
-

Demographic transition: population growth is sensitive to development. It can


be managed in the short and long term. This approach says that Malthusian
projections tend to predict the future based on the past ahistorical, because
they ignore how societies actually evolve.

Demographic regulation: added to demographic transition, it argues that


societies are capable of recognizing and regulating population growth in line
with particular norms that adapt to changes in economic conditions.

Marxist models: developed countries are the problem: it is not a problem of


overpopulation but one of under resourcing developed countries consume
too many resources and negatively affect developing nations. Overall, Marxist
approaches reject the claim that global population growth inevitably means
more people consuming more resources and eventual biological and ecological
catastrophes a large global population can be sustained through changes in
capitalism and consumption.

Disagreement regarding ways of development


Two key areas:
1) How development can be measured and explained: measures used to express
different rates and levels of development.
2) The meaning of development, described as a process and a condition:
a. Process: involves describing and explaining how and why societies
change from one development stage to the next (various processes
involved).

b. Condition: means its possible to identify societies at different stages


in their development (conventional conditions for ex.).

Types of AID for Developing countries


Aid: various forms of public and private assistance given to promote economic
development and social welfare across the globe.
- Non-repayable grants (regalo)
- Repayable loans (prstamos)
- Non-monetary assistance technology, military, advice, training.
- Finance for development
PUBLIC aid
Bilateral (both countries cooperates)/direct aid (1 organization goes and helps the
country):
- Military assistance can be:
a) Economic loans/grants for a country to buy hardware
b) Political military advisors & trainers for a military presence.
-

Humanitarian Assistance:
a) Donations 2011 USA (500m to East Horn, 50m Somalia).
b) Cooperation between countries: ex. Medical assistance
c) Physical aid food and clothes (NGOs, charities).
Multilateral or indirect aid channeled through international agencies (IMF, WB,
1944). Their objective is to lend money at concessional rates to low-income countries.
Receiving countries political and economic conditions before assistance is given
to qualify for this assistance, they must privatize (industries such as gas, water and
electricity).

PRIVATE aid
Channels for both government and privately donated aid. Mainly related to NGOs
that perform different assistances, such as: poverty reduction; medical; humanitarian;
educational; business creation; microfinance.

Is capitalism an obstacle to develop?


Capitalism is an obstacle for development, mainly because of its inevitable outcome:
poverty. Differences will always exist because capitalist societies are characterized by
unequal distribution of wealth and income. Capitalism, so, entails poverty and
poverty obstructs development. People fail to escape from poverty not because of
their individual and social deficiencies but because society is structured to keep them
in poverty. Capitalism needs poor people. And these are forced to adapt to their
social situation: some choose crime and hidden economy, others retreat into
drug/alcohol addiction, and some others struggle to survive by adapting to the
demands of the labour market, such as working at more than one job.

Why arent all forms of AID helpful for developing?


Exploitation: developing nations are locked into a cycle of economic
development that mainly benefits companies from the donor country.

Inefficiency: for new-right/market liberal approaches. Although some forms of


humanitarian aid may be useful, the only long-term development solution is to
incorporate these countries into the global market economy. Involves: TNCs
action.
Effectiveness: aid sometimes used in a way that brings no long-term economic
benefit to the country (roads and future maintenance).

Impact of TNCs (Transnational Corporations)


TNCs corporations based in a specific territory that operate in a range of
countries. TNCs controls 2/3 of world economy. In terms of revenue, of the 100
largest economies, 51 are TNCs.
They were criticized: abuse of market power (paid low prices to producers in
developing countries), profiteering (didnt pay retail prices), marginalization, social
harm (poorest sections find difficult to seek redress for harms caused by TNCs
activities).
Benefits: employment and income increase, educational development, capital
income developed from rents and dividends, increased government income for
infrastructure development, welfare, health and education results of taxation.
Technological development: regional development, industrial growth, technology
transfer: increased access to the knowledge and skills possessed by TNCs.
Conclusion: TNCs used their money size and power to influence governments,
especially in developing countries. However, through TNCs developing countries gain
access to markets in developed nations, and the technological benefits of TNC
activity enable developing nations to compete successfully in such markets. Overall,
the TNCs provide the industrial and technological spark, essential for modernization.
Dependency theory of development
Examine the relationship between developed and underdeveloped societies
advances the view that underdevelopment arises as a consequence of the
relationships that form between underdeveloped and developed societies. In other
words, it argues that underdeveloped and developing societies are kept in a state of
economic dependency by the behavior of developed nations.
Underdeveloped societies: those with dependent economy, dependent on developed
nations in terms of:
- Producing primary products for consumption in developed world.
- Providing markets for their finished goods.
- Product prices being determined by large businesses.

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