Understanding Economic Development Measurement Methods
Learn about different methods used by economists to measure economic development and growth, including income-based indicators and quality-based indicators. Explore thoughts from various economists and key indicators of economic development.
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Presentation Transcript
DEVELOPMENT PLANNING AND ENVIRONMENTAL ECONOMICS B.A.III Year B.A.III Year
OBJECTIVES In the Previous Class: We Discuss about Meaning of Development Ideas of Economists on Development Deference between Economic Development Basis of Comparison between E.D. and E.G In this class: We will know How to measure or indicate Economic development and Growth Ideas of economists in respect to measurement to E.D. & E.G Different- different indicators of Economic Development which have been used in previous and recent years Growth & Economic
How to measure or indicate Economic development and Growth Economists use several methods to measure economic growth and economic development. It is very clear from previous class that in beginning there was no any difference between Economic growth and economic development. The difference shown after second world war. Before Second world war measurement or indicator of Economic Growth or Economic Development was income based mainly on Per Capita Income. But there was much debate on measuring of Economic Growth or Development
Ideas of economists in respect to measurement to E.D. & E.G There is a difference in ideas of economists in respect to what measurement is chosen to Economic growth and Economic Development. According to Mercantilist Economist According to Adam Smith In a country, the quantity of gold and silver was considered as an indicator of economic growth Adam Smith as a measure for economic development of a country, accepted the production power, technical knowledge, labor conditions and specialization of that country.
Conti According to J.S.Mill the level of cooperation in the economy is measurement of economic development . According to Karl Marx According to Rostow According to B.Higgins & VKRV Roa The establishment of Socialism is extreme stage of Economic Development Increasing in Per capita Income is measure of Economic Growth Increasing in Productivity is measure of Economic Growth
Indicators of Economic Development Main indictors of E.D- it can be divided in two category Income Based Indicator Mainly related to Per Capita Income Quality Based Indicator It measures E.D. in term of Quality of Life On the basis of Above categorization there is five most important Indicators of Economic Development 1.PCI Index 2. Basic Needs Approach Index 3.PQLI 4.PPP Index 5.HDI
Per Capita Income Index Traditional Measure of Economic Development It define by ratio of GNP/Population of Country Generally used to measure of the overall level of Economic activity.
Limitations of PCI Index Ignored Proper Distribution of Income It not consider the issue of poverty Ignore cost element Ignore social, human and institutional aspect of economy. It consider each and every person on same level.
Basic Needs Approach It is dependent upon many things such as availability of basic necessities of life food, clothing, shelter equity in the distribution of income and wealth, literacy, health care, clean environment, political and civil rights, etc. Basic Needs Index Education Primary Education Health Life Expectancy Food Per person calorie supply Sanitation Child Mortality rate Water Supply % of Population achieved water supply Residence How or Not at all
Limitations of Basic Needs Approach The basic needs approach is a completely consumption-oriented approach. That it represents social welfarism' in conditions of underdevelopment and thus it is biased against economic growth. The basic needs approach stresses the production of consumer as opposed to capital goods.
Reference M.L. Taneja and Myer R.M, Economics of Development & Planning (with special reference to India), Sixteenth Edition, 2009. A.P. Thirlwall, Growth and Development (with special Reference to Develpoing Economies), Fourth Edition, 1989. S. K. Mishra and Puri V.K, Economics of Development and Planning (Theory and Practice),thirteenth Edition, 2011. . . , ,2013. . . , , ,2009. ,l0 ,u0yky vkSj yky ,l0 ds0, , , 2018. ,l0 ,u0yky vkSj yky ,l0 ds0, , , , 2018.
