Emerging Economies
Key Terms
developing nations, newly developed nations,
welfare state, nationalization
Find Out
• What are the important economic choices that
developing and newly developed nations
must make?
• How have economic choices affected the
development of nations in Latin America
and Africa?
Emerging Economies
Understanding Concepts
Comparative Government What are the
differences and similarities of socialist governments
and communist governments?
Section Objective
Discuss economic problems that have challenged
developing nations and attempts to solve
those problems.
As many Latin American nations
developed their economies, land reform
turned some toward socialism. In Chile, a
socialist government led by Salvador
Allende began an ambitious program to
break up large land holdings and
redistribute land to the people. In 1973 the
army overthrew Allende, established a
military government, and ended land
reform and socialism in Chile.
I. Developing and Newly Developed
Nations (page 772)
A. Developing nations are states with little or
no industry.
B. Newly developed nations are states that
have had significant or rapid industrial
growth in recent years.
I. Developing and Newly Developed
Nations (page 772)
I. Developing and Newly Developed
Nations (page 772)
If you were the leader of a newly
developing nation, what economic model
would you want to follow? Explain.
Answers will vary. Discuss capitalism,
socialism, or a mixed system.
II. The Economic Choices (pages 722–724)
A. Some developing and newly developed
nations rely on the free market, trade and
contacts with the West to develop their
economies; others rely on socialist
economic models.
B. Under socialism the government only owns
and controls some factors of production.
C. Socialists believe that wealth should be
distributed as equally as possible. They try
to achieve this goal by making basic goods
and social services available to everyone.
D. Critics of socialism claim socialist policies
create a welfare state.
II. The Economic Choices (pages 722–724)
Do you think government should have a
major role in the economy? Why or why not?
Answers will vary. Discuss advantages of
specific services and regulations of government.
III. Searching for Economic Answers
(pages 724–726)
A. Socialist governments in developing and
newly developed countries use more
central planning than developed socialist
countries do.
B. Socialist governments often take control of
industries by nationalization.
C. Many developing nations, especially in
Latin America, have a history of foreignowned industries.
D. Nationalization in Latin America has been
both an economic policy and a symbol of
anti-colonialism.
III. Searching for Economic Answers
(pages 724–726)
E. Until recent moves toward free enterprise,
Israel had a moderate socialist economy.
F. After independence, many African nations
tried to develop economies based on one
cash crop or one resource for trade.
G. Economic difficulties forced African countries
south of the Sahara to take on $130 billion
worth of debt by the 1980s.
III. Searching for Economic Answers
(pages 724–726)
How do you think central planning by the
government can be helpful in a
developing nation?
Answers will vary. See Searching for Economic
Answers on text page 724.
IV. Socialism’s Practical Problems (page 726)
A. Socialist ideology remains a popular and
widely held belief in the developing world.
B. Socialism often fails to live up to its promises
because capital investment is a primary
need for developing economies. Failure of
large-scale economic planning in Eastern
Europe has raised doubts that it can work.
C. Western governments have exercised
influence and pressure in favor of a
combination of free markets and democracy
in developing nations.
IV. Socialism’s Practical Problems (page 726)
How do you think the socialist model can
be improved?
Answers will vary. See Socialism’s Practical
Problems on text page 726.
Checking for Understanding
1. Main Idea Create a graphic organizer like the
one below. In the left box, identify the economic
issues facing developing countries. In the right
box, list policies some have adopted to promote
economic progress.
Answers might include: Issues—foreign
ownership of industry, how to achieve rapid
industrial growth, development of cash crops for
export; Policies—nationalization of industry,
centralized planning, agricultural communes,
acceptance of foreign aid and loans
Checking for Understanding
Match the term with the correct definition.
___
C developing nations
___
A newly developed
nations
___
D welfare state
___
B nationalization
A. nations that have had
significant or rapid
industrial growth in recent
years
B. the process by which a
government takes control
of industry
C. nations only beginning to
develop industrially
D. a nation that has an
economic system that
provides many welfare
programs
Checking for Understanding
3. Identify centralized planning, kibbutzim.
Centralized planning is government control of
the economy.
Kibbutzim are collective agricultural
communes.
Checking for Understanding
4. Why have many Latin American industries been
foreign-owned?
Many Latin American industries have been
foreign-owned because of their colonial history
or their reliance upon foreign investment.
Checking for Understanding
5. What factor contributes to socialism in Africa?
Some African leaders adopted socialism
because they viewed Western capitalism as
another form of colonialism.
Critical Thinking
6. Making Comparisons Analyze the economic
choices that developing and newly developed
nations must make in an increasingly
interdependent global economy.
Developing nations may seek to industrialize as
rapidly as possible, whereas newly developed
nations may seek to sustain their rate of growth
and influence the world economy.
Comparative Government Review the
characteristics of economies under
socialist governments and under
communist governments. Create an
organizational chart that illustrates
decision making under each of these
types of government.