National Development and
Political Promises
Ag. Economic Development Fall 2004:
Module 1
2
Meaning of Development
• Development
– A desirable change
• In the context ...
Ag. Economic Development Fall 2004:
Module 1
3
Meaning of Economic Development:
1950’s Material Development
• Economic Dev...
Ag. Economic Development Fall 2004:
Module 1
4
GDP per capita in year 2002 (1995 Constant prices)
122
45029
6147
899
17520...
Ag. Economic Development Fall 2004:
Module 1
5
GDP Per Capita (US $, 1995 Constant Prices)
0
5000
10000
15000
20000
25000
...
Ag. Economic Development Fall 2004:
Module 1
7
Meaning of Economic Development:
1960’s Equitable Development
• Economic De...
• Why is equality
important ?
• Human social sentiment
• Effective demand
• Entrepreneurial
incentive
• Equity and equalit...
Ag. Economic Development Fall 2004:
Module 1
10
Percent of national income received by the poorest and richest
10% (Not th...
Ag. Economic Development Fall 2004:
Module 1
11
Gini Coeficients (0 = Equal distibution)
0
5
10
15
20
25
30
35
40
Ethiopia...
JVP Manifesto 2015
Ag. Economic Development Fall 2004:
Module 1
13
Meaning of Economic Development:
1970’s Qualitative Development
• Economic...
Ag. Economic Development Fall 2004:
Module 1
14
Percent of childen (less than 5 yrs) underweight (malnourished)
0
10
20
30...
Ag. Economic Development Fall 2004:
Module 1
15
Hospital beds per 1000 people
0.0
5.0
10.0
15.0
20.0
Years
No.ofbeds
Ethio...
Ag. Economic Development Fall 2004:
Module 1
16
Access to improved water sources (% Population)
0
20
40
60
80
100
120
Year...
Ag. Economic Development Fall 2004:
Module 1
17
Literacy rate (% of people above 15 years)
0
10
20
30
40
50
60
70
80
90
10...
Ag. Economic Development Fall 2004:
Module 1
18
Meaning of Economic Development:
1980’s Righteous Development
• Economic D...
Ag. Economic Development Fall 2004:
Module 1
19
Female adult (above 15 yrs) literacy
0
10
20
30
40
50
60
70
80
90
100
%lit...
Ag. Economic Development Fall 2004:
Module 1
20
Meaning of Economic Development:
1990’s Sustainable Development
• Economic...
Ag. Economic Development Fall 2004:
Module 1
21
Sustainable Development
Continued …
• Environmental functions:
– Source fu...
EIA Workshop CESAR SQU
05-08 June 2011
22
Ag. Economic Development Fall 2004:
Module 1
23
Forest area as % of land area
0
10
20
30
40
50
60
70
%
Ethiopia 5 5
Japan ...
Ag. Economic Development Fall 2004:
Module 1
24
CO2 emmisions (mt per capita)
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70....
1999-2000
Ag. Economic Development Fall 2004:
Module 1
26
Meaning of Economic Development:
2000’s Development as Freedom
• Every ind...
Freedom
• Freedom is viewed, both as the primary end and as the principal means of development.
• Political freedoms-- "th...
Freedom to Access Education
Jevithayata Hakiyawak – Hakiyawata Rakiyavak
No More Failures
Good Governance
(Yahapalanaya]
• According to the UN, good governance has eight
characteristics.
1. Consensus Oriented (Li...
Political Economic Choice
Production Possibility Curve: Land
EIA Workshop CESAR SQU
05-08 June 2010
31
Tomato/ Hirunika’s
Income
Cucumber/
Namal’s
I...
Fallacy of Democracy
• Arrows Impossibility Theorem
• Consider 3 individuals, 1,2, and 3.
• Consider 3 alternatives A,B, a...
UNP
• UNP predominates on economic growth
• Market orientation (acknowledges market failure in achieving equity) well defi...
UPFA
• War victory yet continuing international conspiracy and eminent
threat to national sovereignty
• Romanticizing the ...
Free (Not including loans)
• Guaranteed price paddy 50 Rs/Kg Tea 90 Rs/Kg Rubber 300 Rs/Kg Milk 70 Rs/Liter
• Rs 100,000 p...
• Emphasis on dignified free life for the individual and development of high quality human resource
• Equity oriented
• Gr...
Development Economics: NREC 6005 39
National development and political promises
National development and political promises
National development and political promises
National development and political promises
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National development and political promises

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Transcripts - National development and political promises

  • 1. National Development and Political Promises
  • 2. Ag. Economic Development Fall 2004: Module 1 2 Meaning of Development • Development – A desirable change • In the context of society what is desirable? – Social welfare (happiness) • Development a process of making people happy! • Unit of analysis is nation (macro) • The intellectual exploration of the meaning of economic development evolved over time (1950’s to 2000).
  • 3. Ag. Economic Development Fall 2004: Module 1 3 Meaning of Economic Development: 1950’s Material Development • Economic Development = Economic growth • Growth in material consumption • Economic growth is measured by NI, GDP • GDP measures only market values (neglects housewife's, environmental resources) • GDP is not comparable across countries due to differences in the size of country, hence adopt Per Capita GDP
  • 4. Ag. Economic Development Fall 2004: Module 1 4 GDP per capita in year 2002 (1995 Constant prices) 122 45029 6147 899 17520 22974 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 Ethiopia Japan Oman Sri Lanka UAE UK Country US$
  • 5. Ag. Economic Development Fall 2004: Module 1 5 GDP Per Capita (US $, 1995 Constant Prices) 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 500001960 1963 1966 1969 1972 1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 Years US$ Ethiopia Japan Oman Sri Lanka UAE UK
  • 6. Ag. Economic Development Fall 2004: Module 1 7 Meaning of Economic Development: 1960’s Equitable Development • Economic Development = Economic growth … 1950’s (Material Development) • Per Capita GDP is not a measure of income distribution • Economic Development = Economic growth + Intra- generational equity … 1960’s (Equitable Development) • Economic growth is necessary but not sufficient – Nature of growth (productive, linkages etc) – Sufficiency is defined by equity (fairness) of the distribution of income (growth)
  • 7. • Why is equality important ? • Human social sentiment • Effective demand • Entrepreneurial incentive • Equity and equality • Equality in means or ends
  • 8. Ag. Economic Development Fall 2004: Module 1 10 Percent of national income received by the poorest and richest 10% (Not the same years) 4 5 4 2 30 25 34 36 0 5 10 15 20 25 30 35 40 Ethiopia Japan Sri Lanka UK Country %ofNI Poorest 10% Richest 10%
  • 9. Ag. Economic Development Fall 2004: Module 1 11 Gini Coeficients (0 = Equal distibution) 0 5 10 15 20 25 30 35 40 Ethiopia Japan Sri Lanka UK Countries GC Column 1 Source GINI index:
  • 10. JVP Manifesto 2015
  • 11. Ag. Economic Development Fall 2004: Module 1 13 Meaning of Economic Development: 1970’s Qualitative Development • Economic Development = Economic growth + Intra- generational equity … 1960’s (Equitable Development) • Equitable distribution is meaningless if the income levels are so low that basic needs are not met (Equal and Poor). • Quality of life = meeting basic food, housing, health, educational needs. • Economic Development = Economic growth + Intergenerational equity + Quality of life
  • 12. Ag. Economic Development Fall 2004: Module 1 14 Percent of childen (less than 5 yrs) underweight (malnourished) 0 10 20 30 40 50 60 Etiopia 48 Japan 4 Oman 24 23 18 Sri Lanka 54 37 38 33 33 UAE 7 UK 2 1978 1979 1981 1987 1991 1993 1995 1996 1998 2000
  • 13. Ag. Economic Development Fall 2004: Module 1 15 Hospital beds per 1000 people 0.0 5.0 10.0 15.0 20.0 Years No.ofbeds Ethiopia Japan Oman Sri Lanka UAE UK Ethiopia 0.3 0.3 0.3 0.2 Japan 9.0 12.5 13.7 16.0 16.5 Oman 0.3 1.6 2.1 Sri Lanka 3.1 3.0 2.9 2.7 UAE 2.8 2.6 UK 10.7 9.6 8.1 5.9 4.1 1960 1970 1980 1990 2000
  • 14. Ag. Economic Development Fall 2004: Module 1 16 Access to improved water sources (% Population) 0 20 40 60 80 100 120 Years %Population Ethiopia 25 24 Oman 37 39 Sri Lanka 68 77 United Kingdom 100 100 1990 2000
  • 15. Ag. Economic Development Fall 2004: Module 1 17 Literacy rate (% of people above 15 years) 0 10 20 30 40 50 60 70 80 90 100 Years %literate Ethiopia 13 20 29 39 Oman 19 36 55 72 Sri Lanka 80 85 89 92 United Arab Emirates 52 65 71 76 1970 1980 1990 2000
  • 16. Ag. Economic Development Fall 2004: Module 1 18 Meaning of Economic Development: 1980’s Righteous Development • Economic Development = Economic growth + Intergenerational equity + Quality of life + Rights … 1980’s (Righteous Development) • Rights such as: – Human (Right to life, Freedom from torture, Freedom from slavery, Right to a fair trial, Freedom of speech, Freedom of thought, conscience and religion, Freedom of movement) – women, – children, – ethnic etc.
  • 17. Ag. Economic Development Fall 2004: Module 1 19 Female adult (above 15 yrs) literacy 0 10 20 30 40 50 60 70 80 90 100 %literate Ethiopia 6 12 20 31 32 34 Oman 5 16 38 62 64 65 Sri Lanka 72 79 85 89 89 90 UAE 38 59 71 79 80 81 1970 1980 1990 2000 2001 2002
  • 18. Ag. Economic Development Fall 2004: Module 1 20 Meaning of Economic Development: 1990’s Sustainable Development • Economic Development = Economic growth + Intergenerational equity + Quality of life + Rights + Intergenerational equity… 1990’s ( Sustainable Development) • A development process that best satisfies the present generation without compromising opportunities for future generations to satisfy them self's.
  • 19. Ag. Economic Development Fall 2004: Module 1 21 Sustainable Development Continued … • Environmental functions: – Source functions – Sink functions – Global functions • Environment is a unique resource because functions are – Non substitutable (biodiversity, green house protection) – Irreversible if damaged • Hence environment needs to be conserved for sustainable development.
  • 20. EIA Workshop CESAR SQU 05-08 June 2011 22
  • 21. Ag. Economic Development Fall 2004: Module 1 23 Forest area as % of land area 0 10 20 30 40 50 60 70 % Ethiopia 5 5 Japan 66 66 Oman 0 0 Sri Lanka 35 30 United Arab Emirates 3 4 United Kingdom 10 11 1990 2000
  • 22. Ag. Economic Development Fall 2004: Module 1 24 CO2 emmisions (mt per capita) 0.00 10.00 20.00 30.00 40.00 50.00 60.00 70.00 80.00 MTpercapita Ethiopia 0.05 0.05 0.06 0.09 Japan 7.08 7.88 8.67 9.34 Oman 0.32 5.33 7.09 8.21 Sri Lanka 0.29 0.23 0.24 0.55 UAE 69.24 34.77 34.34 18.14 UK 11.48 10.30 9.89 9.64 1970 1980 1990 2000
  • 23. 1999-2000
  • 24. Ag. Economic Development Fall 2004: Module 1 26 Meaning of Economic Development: 2000’s Development as Freedom • Every individual has the right to determine his/her own destiny. • Hence has the right in deciding and directing the development process. • Participation/ democracy, Transparency, Good governance … • Economic Development = Economic growth + Intergenerational equity + Quality of life + Rights + Intergenerational equity + Freedom … 2000
  • 25. Freedom • Freedom is viewed, both as the primary end and as the principal means of development. • Political freedoms-- "the opportunities that people have to determine who should govern and on what principles, and also include the possibility to scrutinize and criticize authorities, to have freedom of political expression and an uncensored press, to enjoy the freedom to choose between different political parties, and so on.” • Economic facilities— "the opportunities that individuals . . . enjoy to utilize economic resources for the purpose of consumption, or production, or exchange." The quantity of income as well as how it is distributed is important. Availability and access to finance are also crucial. • Social opportunities--arrangements society makes for education, health care, etc. • Transparency guarantees--these relate to the need for openness that people can anticipate; the freedom to deal with one another with a justified expectation of disclosure and clarity. These guarantees play a clear role in preventing corruption, financial irresponsibility, and violation of society's rules of conduct for government and business. • Protective security--a social safety net that prevents sections of the population from being reduced to abject misery. Sen refers to "fixed institutional arrangements such as unemployment benefits and statutory income supplements to the indigent as well as ad hoc (temporary) arrangements such as famine relief or emergency public employment to generate income for destitutes."
  • 26. Freedom to Access Education Jevithayata Hakiyawak – Hakiyawata Rakiyavak No More Failures
  • 27. Good Governance (Yahapalanaya] • According to the UN, good governance has eight characteristics. 1. Consensus Oriented (Lichchavi) 2. Participatory 3. Following the rule of law 4. Efficient 5. Accountable 6. Transparent 7. Responsive 8. Equitable and Inclusive
  • 28. Political Economic Choice
  • 29. Production Possibility Curve: Land EIA Workshop CESAR SQU 05-08 June 2010 31 Tomato/ Hirunika’s Income Cucumber/ Namal’s Income Points inside the curve are (Pareto) inefficient Points on the curve are efficient PPC SIC
  • 30. Fallacy of Democracy • Arrows Impossibility Theorem • Consider 3 individuals, 1,2, and 3. • Consider 3 alternatives A,B, and C. • Following is the preference ordering. • Individual 1. A>B>C • Individual 2. B>c>A • Individual 3. C>A>B • This means • A>B by 2/3 majority • B>C by 2/3 majority • C>A by 2/3 majority • This gives a social preference ordering • A>B>c>A • This violates the condition of rationality, i.e. transitivity. • Hence the political rule of democracy is a fallacy. It is unable to elicit social preferences. • Yet economic, social decisions need to made.
  • 31. UNP • UNP predominates on economic growth • Market orientation (acknowledges market failure in achieving equity) well defined • Industry bias, agriculture acknowledged • Foreign capital dependent (more western capital) and trade oriented • Acknowledges need to improve agriculture for food security and equity • Eco agriculture • Cooperative business farming • Sustainable energy • SME • Middle class focus • Self reliance • Minimize government • Agricultural Marketing Authority • 5 year salary less vacation • Encouraging small investors on share markets • Addressing corruption: Limiting election expenses; National audit act • Devolution of power • Consensus based political decision making • Health service authority and health insurance system, nursing faculty, preventive health • 6% of GDP for education • One university named for eco-farming • Linking national universities to international universities
  • 32. UPFA • War victory yet continuing international conspiracy and eminent threat to national sovereignty • Romanticizing the past on growth(GDP increased by 3 times from 2005 onwards) – Promise of 8% growth and 4 laks jobs annually • Rural agricultural Banking • Technological Research Labs in Universities • Better utilization of marine resources (sea 23 times than land area) • Garment wholesale hub for middle income countries • Increasing university admission by 30% • Maximum drive time 6 hrs • Accepts yahapalana concepts
  • 33. Free (Not including loans) • Guaranteed price paddy 50 Rs/Kg Tea 90 Rs/Kg Rubber 300 Rs/Kg Milk 70 Rs/Liter • Rs 100,000 per tea hut • Rs 100,000 credit card to 3 wheelers, Rs 30 laks housing loan. • Duty free vehicles for expatriate workers • Minimum salary of government worker 25000 Rs/Month, Private sector increase by 3000 Rs/Month, Estate 1000 Rs/Month • Senior citizens: free transport, medical allowance 3000 Rs/Month, • Reducing prices of food, water, electricity • For Samurdhi holder free gas burner gas canister and 350 Rs/Month for gas. • Rs 50,000 for those between 18-35 years for education • Pre-school teacher 5000 Rs/Month allowance • For school children from 1-5 years a saving of 1200 Rs/Year • University students Rs. 10,000 at admission and Mahapola 6000 Rs/Month, Training allowance for year 5000 Rs/Month for a year
  • 34. • Emphasis on dignified free life for the individual and development of high quality human resource • Equity oriented • Growth dependent on human resources • Mentions of a production economy incentive strategy ambiguous • Produce first for the local economy (Import substitution) • Participatory transparent accountable governance • Voting rights by 16 years • Voting method for expatriates • Education a human right by constitution (unemployment payments) • 6% of GDP for education • Free books, clothes and food for school students • Free lap top computer for university students • Residential facilities for university students and staff • Minimum lecturer salary 100,000 Rs/Month • 500 international scholarships per year for best performing students • Good emphasis on health sector (5% of GDP) • Expatriate vote and education • Right on child birth to women
  • 35. Development Economics: NREC 6005 39

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