Theories of Development in the Modern World

GDP: "Gross Domestic Productan estimate of the total value of all materials, foodstuffs, goods, and services produced by a country in a particular year." Think of it as the value of what is generated domestically within the borders of the country -- regardless of which company is involved.

GNP: "Gross National Productsimilar to GDP, but also includes the value of income from abroad." Think of it as the nationality of production where earnings are allocated to the corporation' home country -- regardless of where production takes place.

Income:

According to the video Affluenza, GNP/GDP omit:

social reproduction - housework, childcare, subsistence agriculture

social and environmental consequences of growth - alienation, pollution

cultural aspects of development - alternative aspirations

GDP goes up:

every time a forest falls
with every oil spill
when new cancer is diagnosed

Alternative ways of measuring development:

GPI - Genuine Progress Indicator
by Ted Halstead from Redefining Progress

GPI takes into account 24 aspects of our economic lives that the GDP ignores.

For example:
GPI adds for the value of housework and volunteerism
GPI subtracts the costs of crime, car accidents and family breakdown

While GDP continues to grow, GPI for the U.S. has declined since 1973.
The overall costs of economic activity are beginning to outweigh the benefits.

GPI - Genuine Progress Indicator

PQLI: personal quality of life index

Combines life expectancy, income, and literacy

Life Expectancy

Infant Mortality

Literacy

Income vs. Debt

First, Second, and Third Worlds.

Transnational corporations:
companies that participate not only in international trade but also in production, manufacturing, and/or sales operations in several countries.

Introduction to development theory: Orthodox vs. Dependency Theories

Where did all these poor people come from?

Orthodox theories of development as modernization are based on two assumptions -

The world consists of autonomous countries where social change is viewed as operating within each separate society.

Social change operates as a series of parallel paths for all societies. Independent countries are defined as societies.
o Stage 5 - age of mass consumption
o Stage 4 - drive to maturity
o Stage 3 - take-off
o Stage 2 - preconditions
o Stage 1 - traditional
At one end, irrational and non-progressive traditional society.
At the other end a rational and progressive modern society.

The process: modernization
'Traditional' society invokes "characteristics of societies which were once universal, but which are now only to be found in poorer countries" (Taylor p.306).
Poverty is seen to be a product of backwardness. Traditional societies can develop by catching up to the leader. (Verhelst)

Challenges to orthodox development theory:
Dependency theory - two paths:

-Rich countries show impressive growth in the core.
-Poor countries show impressive under-development in the periphery.

The development of under-development: some are kept at the bottom by those at the top.
Core-periphery is seen to also exist inside poor countries. A national elite marginalizes the poor.
Development and under-development - two sides of the same coin.

Wallerstein: World Systems Theory
"History consists of the rise and fall of world empires as distinct entities successively incorporating and releasing mini-systems." (Taylor p.314)
Orthodox models "resolutely avoid the study of the international structure of development and under-development of which the domestic structure is just a part." (Frank)
Prescription:
Poor countries must break away and base development on their own needs.

Dependency theory prescription:
Break away from the core.
Base development on your own needs.
Import substitution industrialization (ISI):
high tariffs protect nascent industries

Economic Geography of Location

Agglomeration “The association of productive activities in close proximity to one another.” (Dictionary of Human Geography 2000)

Agglomeration effects:
cost advantages that accrue to individual firms because of their location among functionally related activities.

Ancillary activities:
activities such as maintenance, repair, security, and haulage services that serve a variety of industries.
Examples: “local availability of a skilled labor force, workers familiar with the industry in question, neighboring firms can share infrastructure and services, a university.” (Dictionary of Human Geography 2000)

Localization economies:
cost savings that accrue to particular industries as a result of clustering together at a specific location.
All human activity is localized. All activity is grounded in specific places. They require a spatial fixedness in order to function. Many resources have to be used in place. (Dictionary of Human Geography 2000)

Infrastructure: the underlying framework of services and amenities needed to facilitate production activity.

The case of Singapore – study questions

With no natural resources, how did Singapore develop economically?
How is Singapore’s location related to its economic development?
What did the government do to support economic development?
Describe the agglomeration effects of Singapore’s economy.
Through forward and backward linkages, companies may control all parts of the production process.

Export processing zones:
small areas within which especially favorable investment and trading conditions are created by governments in order to attract export-oriented industries.

The case of Nike in China: (study questions)

Why is Nike producing shoes in distant countries like China?
What allows Nike’s production systems to be so far from markets and resources?
How does subcontracting make production more flexible?
Describe the uneven geography of economic development in China today.
What kinds of social changes are related to economic development?

Spread effects:
the positive impacts on a region (or regions) of the economic growth of some other region.
Backwash effects:
the negative impacts on a region (or regions) of the economic growth of some other region.

Economic development vs. Social development. Where would you rather live in the U.S.?

Development and alienation - examples from the video "Affluenza."

Development as discourse

sources:

Frank, A.G. 1967 'Sociology of Development and the Underdevelopment of Sociology' Catalyst, Summer 1967, pp.20-73

Johnston, R.J., Derek Gregory, Geraldine Pratt, Michael Watts 2000 The Dictionary of Human Geography Blackwell Publishers, Oxford:

Taylor, Peter 1989 'The Error of Developmentalism in Geography' Horizons in Human Geography, Macmillan, New York: pp.303-319

Verhelst, T 1990 No Life Without Roots Zed Books, London:

Wallerstein, I 1979 The Capitalist World Economy Cambridge U. Press