Political Economy of

Development
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Course: Development Economics
Introduction
• Development as a complex process
• Different approaches to development in the second half of the
twentieth and twenty-first centaury
• Each approach heralded as a magic bullet to generate growth, eradicate
poverty and reduce inequality among other goals.
• Mixed development record
• ‘Age of development’-extraordinary advances in the life expectancy and
standard of living after the second world war.
• Resilience of poverty and increase in inequalities(‘without historical
precedent and without conceivable justification’).
• Problem of development remains of huge proportions and in many
dimensions increasing than diminishing.
• Despite reductions of poverty and increase in annual GDP.
• The march of globalization has not led to substantial improvement in
the material and social conditions of large part of the population and
even some cases the situation is worsening.
• The global development agenda has failed to provide framework for
development policy that could deliver the goals of global
development.
• ‘Big idea’ in the 2000s-Millenial Development Goals(MDGs), and in
2015 its successor, the Sustainable Development Goals(SDGs).
• Economic and financial crisis has engulfed in the latest decade has
destabilized development process and the strategies.
• Emergence of China in the global political stage and the other group of countries
often called ‘rising powers’ has challenged the twin notions dominant from 1980s
• Unequivocal embrace of neoliberal globalization is surest path to growth and development.
• There is or can be overarching framework informing a ‘global’ development agenda.
• Underlying the problems of development and the shortcomings of development
policy is an enduring consensus of what causes these trends? And what is to be
done?
• More fundamentally there is little agreement to what development is and how to
recognize it?
• This session will discuss how different theories advance different views and how
they have evolved since the end of WW2?
• How these theories of development has have translated into the evolution of both
the global policy agenda and local , national and regional development strategies,
and
• To also look into the consequences of these ideas for development across the
world.
Ways of thinking about development
• Development is a powerful term and everyone seems to be in favor.
• What development means?

“Higher standard of living. A rising per capita income. Increase in

productive capacity. Mastery over nature. Freedom through control of
man’s environment. But not mere growth, growth with equity.
Elimination of poverty. Basic needs satisfaction. Catching up with
developed countries in technology, wealth power, status. Economic
independence, Self-reliance. Scope of self-fulfillment for all. Liberation,
the means to human ascent.” H W Ardent (1987)
• ‘Development appears to encompass all facets of the good society,
every man’s road to utopia’
Modernization, Structuralist and underdevelopment theories

• Post-war development theory driven by changing world order

• Cold war accompanied large economic, political and security shifts
• Recognition of ‘Third World’ by US and others to contain communism.
• The development project was one of ‘winning over’ Developing countries in order
to contain socialist ideas and the influence of Soviet Union.
• Objective was to set developing countries on a path of western-style
development.
• Modernization theory evolved in the United States in the cold war context.
• ‘A process of social change whereby less developed states acquire characteristics
common to more developed societies’
• ‘Catch up’ was expected not only on economic front but also social and cultural
change so that less developed countries ‘resemble’ developed west.
• Most well known was R R Rostow (1960) ‘stages of economic growth’
• A transition to modernity:- Traditional society; Preconditions to take-off; Take-
off; Road to maturity; Age of mass consumption.
• Clear end point of development as achieved by western societies(US
and Northern Europe)
• The other influences was ‘political development’ –a process by which
liberal democracies were created and institutionalized.
• Ethnocentrism-equation of modernization and westernization
• Dependency and world systems theories emerged as great rivals to
modernization theories during 1960s and 1970s.
• Modernization was distinctively a US (western) perspective on
development and underdevelopment theories had their origins in Latin
America
• Raul Prebisch(1950) who developed structuralist thesis on the
relationship between the global system and the conditions of
underdevelopment observed in Latin America.
• Global economic systems were divided into powerful ‘centre’ and weak
‘periphery’ and identified the ways in which he found ‘terms of
trade(Ep/Ip) favor the centre and disadvantage the periphery.
• Competition among countries exporting primary commodities led to decline in
export prices relative to manufacturing imports.
• Industrialization was impeded leading to the rising income gap between two parts
of the world economy.
• These insights, with the neo-Marxist theories, were labeled as
‘Dependency theories’ which had in its core a notion that
development needed to be understood with reference to the location
of economies within the world capitalist systems and the interactions
of the different parts of the system.
• The obstacles to industrialization that Prebisch had identified, are
rooted in the structure of the global systems-which served to
perpetuate underdevelopment in the periphery as a precondition for
development in the centre.
• ‘Economic development for the few and underdevelopment for the
many’ Gunder Frank (1967)
• Underdevelopment theory was forerunner of debates in the changing
global political economy of development.
• Dependency and world systems theory lost its steam in 1980s and they
lost much of their appeal and influence.
• Underdevelopment theories were wrong footed by events during the
1980s.
• They failed to explain the increasing differentiation and divergence in
the development trajectories of countries and economies in different
parts of the world.
• Success of a very different development strategy in East Asia.
Neo-liberalism and neo-statism
• 1960s big development story was not underdevelopment but rather
spectacular rise of east Asian economies-Newly Industrialized
Economies(NIE)-Taiwan, Korea, Singapore, and Hong Kong.
• Growth rates continued to soar in the Latin American, African
Economies and other developing countries.
• Modernization theories and particularly underdevelopment theory
failed to explain or theorize the rise of NIEs and these countries left
the notion of periphery, third world, developing countries look
redundant.
• The key debate that emerged from the 1970s onwards was between:
• Neo-Liberalism-most influential paradigm in the contemporary period
which came to define the global policy agenda and the panorama of
development strategies around the world.
• Neo-Statism-East Asian experience
• Neo-liberal revolutions under UK prime Minister Margaret Thatcher
and US president Ronald Reagan and their obsession with the relative
performance of North American compared with those organized with
state intervention such as Germany and Japan.
• Neo-liberal theory –roots in the neo-classical economics with the
assumption that individuals are motivated by self-interest and the politics is
similarly conditioned.
• Intervention of states introduces a wide range of distortions and
contradictions which is harmful to the pursuit of growth and development.
• ‘Human well-being can best be advanced by liberating individual
entrepreneurial freedoms and skills within an institutional framework
characterized by strong private property rights, free markets and free
trade’. David Harvey (2005).
• The emphasis fell on depoliticizing’ economic activity and consolidating
market mechanisms of organizing economies and allocating resources
within them.
• These market mechanisms were increasingly global or globalizing in nature.
• Abrupt break in the theories of development
• Underdevelopment theories conceived world economy as imposing
structural impediments to development and neo-liberalism
understood participation as in global economic activity as pre-
requisite for development.
• They saw development as an inherently national process and reasons
for underdevelopment as internal-incorrect government policies,
institutional underdevelopment, and excessive state intervention in
the working of the national economies.
• The problem of neo-liberalism
• The development story unfolding at the time was the group of economies which
contradicted this logic.
• The centerpiece of neo-statism was the developmental state in which state was
recognized to shape, direct and promote the process of economic development.
• Markets were governed rather than free
• East Asia offered a compelling explanation of the divergences in the performance
of the economies in that region and also of Latin American economies.
• Neo-liberal also laid claim to the so called ‘east Asian miracle’ on the basis of very
different readings of its developmental trajectory.
• Denying the role of state and confirming the working of free markets.
• The main bone of contention between neo-liberal and neo-statism was the
relationship between markets and states in development.
• These both schools have similarities
• First, both conceive development as a national process
• Second, both approaches understand development as economic growth
• Both dominate the thinking about development in the contemporary
world.
‘Human development’, gender and environmental theories
• Commitment to ‘human’ or ‘people centered’ development.
• It was a direct challenge to the emphasis on development as aggregate
economic growth.
“The questions to ask about a country’s development are therefore: What has
been happening to poverty? …unemployment? …inequality? If all these have
become less severe, then beyond doubt there has been development. If one
or two of these .. growing worse, it would be strange to call the result
‘development’ even if per capita incomes had soured.” Dudley Seers (1969)
• Human development approaches began to shape in the 1970’s as ‘basic
needs’ approach.
• Contrary to neo-liberal orthodoxy, economic growth was not always
associated with beneficial outcomes of the poor.
• Special redistributive measures were required to target the poor and unemployed.
• Development in this conception emphasized basic material needs(food, clothing
and shelter), access to key services(water, sanitation, health care , education) and
participation in political and decision making processes that affected their lives.
• It was rejected as being ‘western’ and ‘northern’ flavor in the context of ideological
politics of the cold war and the increasing dominance of neo-liberalism.
• Its essence reappeared in the human development theory in the 1980s and 1990s.
• Sen’s development as enhancement of people’s ‘capabilities’ (later as freedoms)
• Freedom was both means and end to development
• Development neglects the needs of women.
• Failure of development to bring out egalitarian societies.
• Extension of ‘basic needs’ to ‘gender needs’ framework which focused
on two set of gender interests
• Practical: associated with material needs
• Strategic: rectification of gender inequalities in political representation,
employment conditions, educational opportunities, freedom from domestic
violence and exploitation and so on.
• Later developed into ‘empowerment’ as increasing women's ability to
secure ‘their own self reliance and internal strength’.
• Environmental issues became the central global developmental
debates in the 1980s.
• Earlier theories assumed natural resources are not considered to pose
obstacle to economic growth and technical solutions will be found to
harness nature on an ever lager scale.
• Limits to growth-population, industrialization, food production,
natural resource depletion, and environmental degradation.
• Sustainable development - ; development that meets the needs of the
present without compromising the ability of future generations to
meet their own needs.
Development theory in practice
• Different ways of thinking about what development means and how
to achieve it.
• Translation of these different ways of thinking into policies and
strategies and to understand their impact and consequences.
• All look into contemporary period of development from the period of
second world war to the present time, in the midst of accelerating
process of globalization
• Two periods
• The mid 1940s to the early 1980s
• The 1980 onwards
The mid 1940s to the early 1980s
• Across the world what constituted ‘Third world’, post war development
context different than what has prevailed before
• First, onset of the period of decolonization in which African and Asian
countries achieved independence from European powers.
• Second, the experience of great depression (of 1930s) and Two world wars
prompted a reassessment, particularly in Latin America, of broadly
perusing Laissez-fare economic policies and the dependence of
industrialized countries as market for their primary products and imports
of manufacturing goods.
• Third, demographic trends necessitated urgent attention to employment
• Finally, world economy was defined for all developing countries by
protectionism in the key European and US markets and the establishment
of Bretton Woods system dominated by established powers and
developing countries had no means to effective participation.
• These circumstances led to two immediate priorities for development strategies
• Resumption of growth, Industrialization , creation of employment
• Reducing the dependence on north and ensuring effective participation in the new
international system.
• Twin imperative was ‘catching up’ and ‘breaking out’
• Key divide in development theory-modernization and underdevelopment theory.
• Catching up by route of emulation (political, institutional and economic) through
Aid pumped into developing countries(particularly countries that hold key
strategic importance).
• Yet for modernization theory insistence on export led growth was more that of
aid.
• Underdevelopment theory gained more traction.
• Governments in Latin American economies taking their cue from the
structuralist theories of Raul Prebsch- ‘inward looking’ than ‘outward
looking’.
• Import-substituting industrialization (ISI) policy-implemented widely
in South Africa and South Asia but more pronounced in Latin America.
• Three central goals of ISI
• Industrialization through state intervention and restructuring away from
primary products and importance to foreign capital over trade.
• Programme of social reform and employment generation
• Autonomy vis-à-vis international economy.
• Politically developing countries were marginalized in within the new system
• Bretton Woods institutions(World Bank and IMF) were not set up as
development institutions, rather focused on the needs of the industrialized
countries particularly in the postwar reconstruction.
• Early 1960 WB and IMF begin to engage substantially in developing
countries and acknowledging these countries demands.
• The ability of government in developing countries were limited due to
voting structure(based on contribution) as US occupies a particular privilege
and veto power even today.
• GATT operated similarly to marginalize developing countries-left no scope
for achieving cooperation with industrialized countries.
• These concerns entrenched the convention that developing countries
needed to rely on solidarity and cooperation among themselves.
• The Non-Aligned Movement(NAM) and New International Economic
Order(NIEO) were the key political movements that emerged.
• The first demand sovereignty of developing countries to be taken
more seriously.
• Economic demands: reducing dependence on developed countries,
vulnerability to deteriorating terms of trade for raw material exports
and economic sovereignty by enhancing control over FDI and natural
resources.
• These concerns were raised in the context of a drastic shift in the international political
economy
• Abolition of Gold-Standard
• OPECs Oil embargo of 1973
• Increased oil prices badly hit oil importing developing countries that led to vast
increase of borrowing among developing countries -1970s and early 1980s.
• Also the ISI experiment(remined dependent on foreign capital) in Latin American
countries-Argentina, Brazil, Chile, Columbia and Mexico- were marked by heavy
participation of TNCs.
• ISI model in its later stages came to be driven by the massive accretion of foreign debt.
• The debt crisis marked the end of ISI experiment –inward looking development
strategies.
• The crisis of development in Latin America and the East Asian economies moving in opposite
direction.
• Japan-grew at an annual rate of 7% moving from twentieth largest exporter to third largest.
• NIEs grew at an annual rate of 8 % and the success of these Asian economies secured global
presence and influence.
• The development trajectory was not inward looking although the goals were formulated on
nationalist terms.
• 1960s Asia was marked with increased access to international finance markets of
industrialized countries and more importantly the increasing relocation of global productive
capacity to low cost site which was then thought of as a periphery.
• Japanese and East Asian economies possessed the strength and autonomy to manage FDI on
the local economies and less negatively affected by dominance of foreign TNCs.
• ‘Age of development’ looked different for different parts of the
developing economies.
• East Asian NICs experienced high growth rates
• Latin America was modest and Sub-Saharan African economies was most
gloomy.
• Manufacturing exports declined in SAEs 1970s and 1986 and during same
time jumped fivefold for Latin America sixfold for Middle East and North
Africa and thirteenfold for East Asian NICs.
• In 1965 Indonesia per capita GDP was lower than Nigeria’s and Thailand
lower than Ghana’s.
• Sub-Saharan Africa was sliding backwards and east Asian NICs surged
forwards.
The 1980s onwards
• Dominated by Neo-liberal agenda-freeing markets and ‘rolling back’ the
state.
• Neo-liberal was a response to-Keynesian growth strategies and welfare
state policies in Europe in the 1970s yielded twin economic problems of
stagnant growth rates and accelerating inflation(dubbed as stagflation) and
associated political changes of increased militancy among trade unions.
• In the developing countries, critique was extended as an attack on ISI.
• Neo-liberal though came to consolidate itself as ‘counter-revolution’ in
developmental thinking.
• ‘Washington Consensus(WC)’-a blueprint to neo-liberal developmental
thinking.
• WC was presented as commonsense and immune to sensible questioning
• Capital was understood to respond objectively to national macroeconomic
and policy conditions and putting place the ‘right’ policies listed in the WC.
• The main channels of dissemination was IFIs –WB and IMF.
• During 1980s Structural Adjustment Programmes (SAPs) that ruled the day-
reflecting ‘one-size-fits-all’ policy prescription applied widely to Latin-
America, Caribbean, Sub-Saharan Africa, eastern Europe.
• Lending's were subject to stringent forms of conditionality-dependent on
country's conformity with the economic and political policy conditions
attached to loans from IFIs.
• By the end of 1980’s SAPs were failing in Latin America and most African
economies widely seen as ‘lost decade’.
• The IFI’s changed the tack, dropping the ‘structural adjustment’ to ‘good
governance’ by which Bank sought to assert the new focus on centrality of
institutions of in economic reform and development process.
• The first generation reforms
• Macroeconomic stabilization(lowering inflation), and adjustment (trade
liberalization, financial deregulation and privatization)
• The second generation reforms
• Modernization of state, fiscal reform, tax reform, Labour flexibilization
• From the Britton Woods era and the 1980 the insistence was
‘apoliticism’ –agenda would not interfere with domestic political
arrangements
• but the good governance agenda gave IFIs license to intervene in
highly political ways in developing countries.
The crisis of Washington consensus in the 1990s
• Neo-liberal development project was in trouble and the credibility of
WC in great strain
• The record of development was disappointing in Latin America,
Eastern Europe and Sub-Saharan Africa
• Mexican peso Crisis 1995 following speculative attack on global
financial markets.
• The Asian financial crisis of late 1990s knocked both neo-liberalism
and neo-statism
• We will further look into detail of this period in different aspects to
understand the broad trends.
Growth
• East Asian economies continued to grow in 1980s and 1990s
• The locus shifted from NIC to China and India
• China grew at an average annual GDP growth rate of 9.5% during
1980’s to 2000s to 10.7% by 2006.
• For India the figures were 6.5 percent from 1980s to 2000s and 8.6%
from 2003-7.
• Significant level of integration into global economic processes in
production and trade and not extended to financial markets.
• Autarkic trade in both countries till 1980s
• Asian crisis a setback to NICs
• In Latin America, Per capita GDP grew more slowly during 1990s than
between 1950s and 1980s and in 2000s even lower.
• In Africa, of the twenty eight countries that engaged in SAPs, half of
them experienced decline in annual growth rate of GDP PCY.
• Export growth were recorded lower than the rest of the world both in
agriculture and manufacturing.
Trade
• There are divergence between those who were integrated into international trade
patterns (East Asian NICs) and those that relied on primary commodities (Latin
America and sub-Saharan African countries).
• Price collapsed for African export crops of cocoa, coffee(70% both) and
cotton(28%) in the 1980s.
• Protectionism in agriculture and government subsidies(30-37% of farm receipts)
by OECD countries.
• In EU(34%), Japan and Korea(around 60%) and Norway, Switzerland and
Iceland(70%).
In early 2000s, US was responsible for 20% of global agricultural subsides and and
EU-40%.
• Agriculture always stayed off the negotiation table at the international trade
negotiations.
• The expectation was that developing countries unilaterally liberalize trade in key
sectors
Finance, investment and debt
• Growth in private investment flows in the developing world.
• Developing countries FDI share at 40% from 15% during 1990s.
• FDI was dominated (associated with privatization) than portfolio investment.
• Private flows were five times greater than aid during 1990s.
• Uneven pattern- 95% went to only 26 of 166 countries.
• Sub-Saharan Africa largely bypassed.
• Debt of the most heavily indebted countries was 103 % of total GDP between 1995-
2000.
• Argentina- debt to foreign exchange from exports reached 500% and almost 40-50-%
of GDP during 2000.
• Heavily Indebted poor countries (HIPC) initiative- not to eliminate debt but reducing it
to sustainable levels.
• G7 multilateral debt relief initiative provided great relief.
Poverty and Inequality
• Two points
• First, Neoliberal development project did not yield desired result
• The poverty rates reduced at the aggregate levels and the improvement is
entirely accounted by East Asia especially China.
• Extreme poverty($1) increased in most other parts of the world and increase
was greater using $2 poverty line.
• Second, recurrence of economic crisis increased the vulnerability of
population to poverty. Asian financial crisis, poverty increased by 22
million.
• The case of new paradigm for development-Post WC (Joseph Stiglitz).
• Emphasized the role of state intervention in economies to compensate the
market failures and imperfections.
• All aspects of society (state, private sector, family, community and individual)
need to be incorporated and focus on sustainable and equitable
development.
• Greater emphasis on democratic democratic governance, advocated reforms
of IFIs.
• PWC faded quickly because it coincided to more explicit approach into the
global development agenda by proponents of ‘human development
approach’.
• Works of Sen and others at the UNDP had found central place during the
1990s and 2000s particularly in evolving interest in poverty reduction
along with global governance.
• Two key frameworks emerged
• The poverty reduction strategy papers (PRSP) approach and MDGs
• PRSP aimed to emphasize local ownership in global poverty reduction
strategies involving
• Promoting opportunities and pro-poor growth
• Facilitating empowerment particularly by good governance
• Enhancing human security –health, education and social security nets or social
protection measures.
• MDGs a practical expression of human development and commitment
by international community in achieving targets.
• Two aspects of MDGs
• Emanated from rich country development ‘ a donor country interpretation of
key issues, for a donor country interpretation of the key issues’.
• No mention of issues relating to globalization, global politics and unequal
power structures.
• The implicit assumption-the development problems of the world
could be rectified by the global concert of government and
institutions pushing market reforms in the national context.
• The core of MDG1 to halve the proportion of people living less than $1 had been achieved
by late 2000s and by late 2015, the world poor people had fallen to less than 10% of
world population-1.9billion to 836 million in 2015.
• Disparities between regions and countries within regions and variability between group of
people.
• In 1990s, East Asia accounted 50% of the poor and sub-Saharan Africa 15% and in 2015
there was a reverse shift of the composition.
• China accounted the bulk of reduction-662 million lesser in 2008 than in 1981.
• Latin America, the reduction of extreme poverty was heavily skewed by trends in large
economies-Mexico and Brazil, others showing no improvement or in some case slight
increase.
• Sub-Saharan African countries had a modest reduction of poverty since 1981 but still less
than half in extreme poverty.
• Poverty more entrenched in country with conflicts or strongly dependent on primary
commodities.
• However, number of people living between $1.25 to $2 doubled between 1981 and 2008.
Achievements
• Tripling of number of people in working middle class (above $4)
• Having of undernourishment, primary school age children not in school and child
mortality rates.
• Gender parity in schools, significant progress in sanitation and disease control or
eradication-HIV/AIDS and TB
• In 2017, 689 million still in poverty expected to rise due to COVID-19.
• Conflict, environmental degradation, climate change and gender inequality
remains a major issue.
• Growing inequalities between households and regions.
• Post-2015 strategy-new set of goals to guide the goals of global development
agenda till 2030 called Sustainable Development Goals (SDGs-17)
• Goals are both economic and social, inequality was integrated and greater voice
of developing countries and associated social groups.
Trends
Measurement issues
• Exchange rate method
• US$24 trillion-1993, 20% Low and Middle income Countries and 85%
of World population
• Switzerland (Richest) per capita Income 400 times that of
Tanzania(poorest)
• Measurement issues
• Underreporting and proportion of income for self-consumption in rural settings
• Non-traded goods
• Market prices (imperfect competition)
• PPP Method
Percentage distribution of Population
1970 1980 1990 2000 2010 2013
Low Income developing 8.10 8.54 9.21 10.27 11.43 11.81
Low Middle Income Developing 27.60 29.24 31.02 32.86 34.44 34.82
Upper Middle Income Developing 33.46 34.29 34.60 33.95 32.75 32.44
High Income Developing 2.04 2.12 2.17 2.15 2.24 2.26
Total developing 71.20 74.18 77.00 79.23 80.86 81.32
Low Income Transitional 0.10 0.11 0.11
Low Middle Income Transitional 1.47 1.30 1.27
Upper Middle Income Transitional 0.06 0.06 0.06 0.92 0.84 0.83
High Income Transitional 7.13 6.46 5.87 2.39 2.07 2.00
Total Transitional 7.19 6.52 5.93 4.89 4.32 4.21
Upper Middle Income Developed 1.07 0.95 0.80 0.66 0.54 0.51
High Income Developed 20.55 18.35 16.27 15.22 14.27 13.95
Total developed 21.62 19.30 17.07 15.88 14.82 14.47
World 100 100 100 100 100 100
BRICS 40.22 41.14 41.67 43.92 42.79 42.37
Next-14 46.98 48.18 48.82 48.72 51.41 51.09
World minus BRICS 59.78 58.86 58.33 56.08 57.21 57.63
World minus Next-14 53.02 51.82 51.18 51.28 48.59 48.91
Source: UNCTAD Stata 2015
Note: ‘Next 14’. These include Argentina, Brazil, Chile and Mexico in Latin America; Egypt and South Africa in Africa, and China, India, Indonesia, Malaysia,
Korea, Thailand, Taiwan and Turkey in Asia.
Percentage distribution of GDP
1970 1980 1990 2000 2010 2013
Low Income developing 1.31 1.02 0.71 0.53 0.71 0.84
Low Middle Income Developing 4.57 5.45 3.57 3.62 6.25 6.55
Upper Middle Income Developing 9.87 11.93 9.50 12.41 20.52 23.53
High Income Developing 1.37 3.80 3.71 5.06 5.37 5.97
Total developing 17.12 22.20 17.49 21.63 32.85 36.89
Low Income Transitional 0.00 0.01 0.01
Low Middle Income Transitional 0.16 0.32 0.38
Upper Middle Income Transitional 0.07 0.02 0.01 0.18 0.56 0.67
High Income Transitional 13.17 8.22 3.70 0.78 2.33 2.77
Total Transitional 13.24 8.24 3.71 1.13 3.22 3.84
Upper Middle Income Developed 0.83 0.59 0.43 0.29 0.53 0.50
High Income Developed 68.82 68.97 78.37 76.95 63.40 58.77
Total developed 69.64 69.56 78.80 77.24 63.93 59.27
world 100 100 100 100 100 100
BRICS 6.06 6.23 5.45 8.12 17.88 20.92
Next-14 10.47 11.40 11.23 15.00 23.98 26.93
World minus BRICS 93.94 93.77 94.55 91.88 82.12 79.08
World minus Next-14 89.53 88.60 88.77 85.00 76.02 73.07
Source: UNCTAD Stata 2015
Inequality ratios in Per capita GDP In Current US$ (Per cap of X/Total developed)x100
1970 1980 1990 2000 2010 2013
Low Income developing 5.01 3.30 1.66 1.06 1.43 1.73
Low Middle Income Developing 5.14 5.17 2.49 2.27 4.21 4.59
Upper Middle Income Developing 9.16 9.66 5.95 7.52 14.52 17.71
High Income Developing 20.91 49.74 37.08 48.49 55.56 64.52
Total developing 7.47 8.30 4.92 5.61 9.41 11.07
Low Income Transitional 0.53 1.83 2.43
Low Middle Income Transitional 2.26 5.78 7.31
Upper Middle Income Transitional 36.38 8.23 3.38 4.09 15.37 19.80
High Income Transitional 57.34 35.33 13.68 6.72 26.14 33.89
Total Transitional 57.17 35.08 13.57 4.75 17.29 22.25
Upper Middle Income Developed 23.95 17.25 11.57 9.19 22.53 23.82
High Income Developed 103.96 104.29 104.37 103.93 102.95 102.81

Total developed 100 100 100 100 100 100

world 31.04 27.75 21.67 20.56 23.18 24.41
BRICS 4.68 4.20 2.84 3.80 9.68 12.05
Next-14 6.92 6.57 4.98 6.33 10.81 12.87
World minus BRICS 48.77 44.20 35.12 33.68 33.27 33.49
World minus Next-14 52.41 47.44 37.58 34.09 36.26 36.46
Source: UNCTAD Stata 2015
Data based task
• GDP comparison of countries with 1] exchange rate based GDP 2]PPP based GDP

• Historical experience of economic growth 1] growth rates from 1960 to 1980

then from 1980 to 2000 then from 2000 to 2010 and then 2010 from 2020
(recommended source: Penn World Tables, but any other source is fine) for
following countries/group of countries: US, China, Japan, Germany, European
countries, India, Low income countries and sub-Saharan African countries

• Income share of top percentile and income share of bottom 20% (for all
countries and for years 1995 and 2020) (Source can be World Bank data, UNU
WIDER Inequality Data base )

• Cross country Relationship between 1] Education attainment and income 2] life

expectancy at birth and income 3] infant mortality and income for year 1995 or
any year till 2000 and 2020) Source: UNDP Human development data or World
Development Indicators

• Reference: Debraj Ray, Development Economics, chapter 2 (the chapter has all
above mentioned comparisons. But author has reported these comparison for
1995 or some year is 1990s. We will have updated comparisons or patterns. )