Reneé Ann Rose A. Casihan
BSA 1203
Economic Development
Economics 310
Activity ED-001
Feb. 8, 2022
Answer the following in your own words.
1. Briefly describe the various definitions of the term development encountered in
the text. What are the strengths and weaknesses of each approach? Do you think
that there are other dimensions of development not mentioned in the text? If so,
describe them. If not, explain why you believe that the text description of
development is adequate.
The term ‘development’ is a broad topic. It is considered to have a wide
concept because of its different meaning in every situation. According to the text,
it doesn’t have a specific definition. In economic terms, there are two major
definitions of development which is the traditional and modern view. It is
described traditionally as attaining the growth of income per capita. On the other
hand, development as a modern view provides a wider concept such as education,
poverty, eradication, provision of adequate health, reduction of income inequalities
and increase of production. Its advantage is that it covers a love of sector that
benefits many people but it lacks power in development because of its long
process. The text description is adequate because it includes all sectors such as
social, economic, political, cultural and environmental. These sectors play a huge
role in determining the standards of living of people in a country.
2. Why is an understanding of development crucial to policy formulation in
developing nations? Do you think it is possible for a nation to agree on a rough
definition of development and orient its strategies accordingly?
A deep understanding of development provides a clear execution of it. In
order to achieve a certain goal in developing nations, a country must be
knowledgeable about its overview. The purpose of a policy is to bring out a
positive outcome in the economy of a nation. With this, they are able to figure out
what they need to do and things that they should not do. It is possible for a nation
to agree on a rough definition of development and orient its strategies accordingly
as long as they are committed to this.
3. Why is a strictly economic definition of development inadequate? What do you
understand economic development to mean? Can you give hypothetical or real
examples of situations in which a country may be developing economically but
may still be underdeveloped?
People's attitudes change as an outcome of providing more education,
health facilities, and women's status changes as a result of a strictly economic
definition of development. It also provides opportunities for employment to
alleviate poverty. Income inequalities are reduced. In addition, it has adequate
health facilities. For a balanced economy, it increases production in all sectors of
the economy, including agriculture, industry, and higher education.
4. Why do many economists expect income convergence between developed and
developing countries, and what factors would you look to for an explanation of
why this has occurred for only a limited number of countries and in such a limited
degree so far?
For developing countries, globalization has opened up new possibilities.
For example, technology transfer holds promise for increased access to markets in
developed countries, as well as increased productivity and living standards. It is
also observed that in considering all other things being equal, investment returns
in poor countries are higher than in rich countries. Poor areas can also grow
quickly by adapting rich countries' productive processes. The poorer countries
should grow at a faster rate than the wealthier ones as an outcome.
5. In your opinion, which measure shows more equality among countries around the
world—GNI calculated at exchange rates or GNI calculated at purchasing power
parity? Explain
In my opinion, the GNI calculated at purchasing power parity shows more
equality among countries around the world because PPP rates of exchange, with
the exception of market exchange rates, allow this conversion to consider the
impact of price differences among countries.