The Changing Economic World
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Measuring development
Development measures how far a country has progressed economically and socially. No single indicator gives a complete picture.
The HDI is widely used because it combines economic and social measures, avoiding the limitations of GNI per head alone.
Measuring development — Key Knowledge
- GNI per head total national income divided by population
- Birth rate births per 1,000 per year
- Death rate deaths per 1,000 per year
- Infant mortality rate deaths of children under 1 per 1,000 live births
- Life expectancy average number of years a person is expected to live
- Literacy rate percentage of adults who can read and write
- HDI composite measure using life expectancy, education, and GNI per head — value between 0 and 1
Causes of uneven development
Development is uneven across the world due to physical, economic, and historical factors.
Historical causes such as colonialism continue to shape development patterns today — their effects are not just in the past.
Causes of uneven development — Key Knowledge
- Climate extreme conditions limit farming and industry
- Terrain mountainous or landlocked countries face transport difficulties
- Natural hazards earthquakes and tropical storms destroy infrastructure
- Unfair trade terms LICs export cheap raw materials, import expensive manufactured goods
- National debt repayments divert money from health and education
- Colonialism resources extracted, borders drawn ignoring ethnic groups, infrastructure built for export not development
Consequences of uneven development
Uneven development creates disparities in wealth and health, and drives international migration.
Migration is both a consequence of uneven development and a factor that can widen the gap further through brain drain.
Consequences of uneven development — Key Knowledge
- Wealth disparities GNI per head ranges from below $1,000 to over $60,000
- Health disparities life expectancy varies from below 55 to above 80
- International migration people move from lower-income to higher-income countries
- Brain drain skilled workers leave origin countries, reducing their capacity to develop
Reducing the development gap
A range of strategies can help close the gap between richer and poorer countries.
No single strategy works alone — most successful development combines several approaches tailored to local conditions.
Reducing the development gap — Key Knowledge
- TNCs bring jobs, skills, and infrastructure but profits may flow back to the HIC
- Tourism brings foreign currency but can cause environmental damage and cultural erosion
- Aid — bilateral government to government
- Aid — multilateral via organisations like the World Bank
- Aid — NGOs non-governmental organisations like Oxfam
- Intermediate technology suited to local needs, skills, and wealth — e.g. hand pumps, solar cookers
- Fair trade guarantees producers a fair price — provides stable income and community premiums
- Debt relief cancelling debts frees up government money for services
- Microfinance loans small loans to individuals or groups to start businesses — no collateral needed
Nigeria — location and importance
Nigeria is the largest economy and most populous country in Africa, located in West Africa on the Gulf of Guinea.
Nigeria's size and oil wealth give it a dominant role in West Africa, but internal challenges limit its development.
Nigeria — location and importance — Key Knowledge
- Borders Niger, Chad, Cameroon, and Benin, Member of OPEC significant oil reserves
- Large and growing consumer market, Cultural influence Nollywood, music
- Regional political influence within ECOWAS
Nigeria — political and social context
Nigeria has a complex political history and significant social diversity that affect its development.
Political instability and corruption divert resources away from health, education, and infrastructure investment.
Nigeria — political and social context — Key Knowledge
- History of military rule transition to democracy in 1999
- Over 250 ethnic groups ethnic and religious diversity
- Boko Haram ongoing security threat in the north-east
- Corruption significant barrier to development
Nigeria — economy and TNCs
Nigeria's economy is shifting from agriculture towards manufacturing and services, with TNCs playing a major role.
Oil dependence makes Nigeria's economy unstable — when global oil prices fall, government revenue drops sharply.
Nigeria — economy and TNCs — Key Knowledge
- Primary sector agriculture still employs the majority
- Secondary sector growth manufacturing expanding
- Tertiary sector growth services, banking, mobile banking
- Oil dominates exports vulnerable to price fluctuations
- Shell oil extraction brings investment but causes environmental damage in the Niger Delta — oil spills, gas flaring, water contamination
- Manufacturing TNCs e.g. Unilever — employment and skills transfer
Nigeria — environmental impacts and quality of life
Economic development in Nigeria has brought environmental costs and uneven improvements in quality of life.
Nigeria's development gains are real but unevenly spread — location within the country strongly affects quality of life.
Nigeria — environmental impacts and quality of life — Key Knowledge
- Oil pollution in the Niger Delta water and farmland contamination
- Deforestation for agriculture and logging
- Desertification in the north linked to overgrazing and climate change
- Urbanisation problems waste management in cities like Lagos
- Life expectancy and literacy improving overall, North-south inequality huge gap between north and south, urban and rural
- Lagos growing middle class alongside widespread slums, e.g. Makoko
UK deindustrialisation and post-industrial economy
The UK has shifted from manufacturing to a service-based economy, a process known as deindustrialisation.
Deindustrialisation does not mean the UK stopped manufacturing — it still produces aerospace, pharmaceuticals, and cars, but employs far fewer people doing so.
UK deindustrialisation and post-industrial economy — Key Knowledge
- Deindustrialisation decline of manufacturing due to cheaper overseas production and mechanisation — e.g. coal, steel, shipbuilding
- Service sector now employs over 80% of UK workers
- Quaternary sector growth knowledge-based — universities, research, consultancy
- Science and business parks purpose-built sites near universities and motorways — e.g. Cambridge Science Park, MediaCityUK Salford
The north-south divide and strategies
A persistent economic gap exists between the more prosperous South East and the less prosperous North, Midlands, and devolved nations.
The north-south divide is a broad pattern with significant exceptions — there are pockets of deprivation in London and prosperity in northern cities.
The north-south divide and strategies — Key Knowledge
- Income differences higher average wages in the South East
- Employment differences higher unemployment in parts of the North
- Health differences lower life expectancy in some northern areas
- House price gap significantly higher in the South East
- Enterprise zones tax breaks and reduced planning restrictions to attract businesses
- Transport improvements HS2, Northern Powerhouse Rail
- Devolution powers to city regions, e.g. Greater Manchester Combined Authority
- Regeneration projects e.g. Liverpool ONE, Salford Quays
UK links to the wider world
The UK is a major trading nation connected globally through trade, transport, culture, and electronic communication.
Globalisation means the UK economy is increasingly interconnected with the rest of the world — events abroad directly affect UK jobs and trade.
UK links to the wider world — Key Knowledge
- Trade imports and exports goods and services globally
- Heathrow global transport hub
- Channel Tunnel direct rail link to mainland Europe
- English language and media global cultural influence
- Electronic communication internet and social media connecting businesses worldwide
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The Changing Economic World
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