Economic Development - Todaro and Smith Chapter 2 PDF

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Summary

Economic Of Chapter 2 presents several important topics in development economics. They classification of countries according to economic and social method of measuring the level economic development across countries The Human measurement and ranking of overview of the common development problems fac...

Description

Economic Development Summary Of Chapter 2 Chapter 2 presents several important topics in development economics. They are 

A classification of countries according to economic and social indicators

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A method of measuring the level economic development across countries The Human Development Index: measurement and ranking of countries

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An overview of the common development problems faced by many developing countries

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A discussion on the relevance of the historical experience of the developed countries for the less developed countries

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A discussion of the question of income convergence across countries

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A discussion of long-run causes of comparative development Per capita income (using exchange rate conversion and/or in purchasing power parity equivalence) is used to classify countries. Data on several social indicators (e.g., life expectancy and adult literacy) complement per capita income to measure economic development as a broad based improvement in human life. Moreover, the Human Development Index is employed to measure development and to classify countries. Developing countries are not homogeneous but are enormously diverse in their structure. Nevertheless, they have several common features and problems including the following:

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Lower levels of living and productivity

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Lower levels of human capital investment

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Higher levels of inequality and absolute poverty

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Higher rates of population growth

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Greater social fractionalization

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Larger rural population and rapid rural-urban migration

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Lower levels of industrialization and manufactured exports

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Adverse geography

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Underdeveloped markets

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Lingering colonial heritage, external dependence, and governance challenges

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Relative importance of private and public sectors and civil society The chapter concludes with a discussion on the relevance of the historical experience of the developed countries to today's LDCs with respect to: 

Physical and human resources endowments

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Per capita income and GDP relative to the rest of the world Population size, distribution, and growth

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Historical role of international migration International trade benefits Scientific and technological research capabilities

Efficacy of domestic institutions Due to variable income growth rates, it is expected that the per capita incomes within MDCs would converge. However, the MDCs-LDCs income disparity has a tendency to widen over time 

Written By Aneesh Matlani...