Development Economics Flashcards

Only 10 flashcards are shown at a time! Once you’ve mastered these 10 Economic terms, click the shuffle button below for 10 new terms. There are approximately 45 flashcards covering Development Economics.

World Trade Organization (WTO)
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An organization aimed at liberalizing trade by facilitating the reduction or elimination of trade barriers between member states.

World Trade Organization (WTO)
Relative poverty
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The state of earning an income that puts one in the lowest income level within his or her own country. Unlike absolute povery, it exists everywhere, since within even the richest nations a proportion of the population earns relatively less than the top income earners.

Relative poverty
Infrastructure
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The physical assets of a nation which increase the efficiency with which the nation produces its output. Includes all the roads, electricity grids, water and sewage facilities, but also factories, airports, railways, tunnels, bridges schools and hospitals: anything that increases the productivity of labor in the nation.

Infrastructure
Fair Trade
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A trade scheme which promotes better working and living conditions among the producers of primary commodities such as bananas and coffee in less developed countries. Attempts to assure that a larger percentage of the final sale price of such commodities makes it back to those who produced them.

Fair Trade
Public sector
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Refers to the activities undertaken by the government or the state. “Public sector investment” generally refers to government spending on infrastructure.

Public sector
Debt cancellation
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See indebtedness. When international lenders from a more economically developed country (MEDC) who are owed money by a the government of a less economically developed country (LEDC),usually from loans taken out by corrupt governments in the past, forgive the debt they are owed. Allows for the limited tax revenues collected by the developing country’s government to be used to provide public goods and services (such as infrastructure, education and health care) which contribute to the poor country’s economic development.

Debt cancellation
Commodity
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A good widely demanded (often globally) and supplied by many sellers, usually without much product differentiation between sellers. Commodities are standardized products. The price of commodities is determined by the market as a whole, often in the global market, not by any individual producer or group of producers. Often traded on national or international commodities markets. Examples include oil, wheat, corn, coffee, copper, cotton, tin, rice, gold, and other primary goods.

Commodity
Foreign Direct Investment (FDI)
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Investment in factors of production abroad by multi-national corporations.

Foreign Direct Investment (FDI)
Productivity
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The output per unit of input of a resource. An important determinant of the level of aggregate supply in a nation. Will increase as a result of better or more capital, education and health, all which add to the human capital of a nation.

Productivity
Human Development Index (HDI)
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A measure of the standards of living, used to rank countries based on their level of human development. It takes into account three primary variables: the level of GDP per capita, (as an indication of income levels), literacy (as an indication of education levels), and life expectancy (as an indication of levels of health). Countries are placed into one of four categories based on their HDI ranking: “very high human development”, “high human development”, “medium human development” and “low human development”.

Human Development Index (HDI)

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