Wednesday 21 November 2012

Ways Of Measuring Development Of The Countries Worldwide

Definition of development

"Development is defined as ‘the process of change operating over time’. Traditionally the term is synonymous with economic growth and it is seen as the process by which countries and societies advance and become richer. The roots of this traditional approach can be traced to Victorian England, in the Colonial era, where indigenous people (the natives!) were deemed to be less developed than their colonial masters."
Source

Three worlds model 

Nowadays, this is the most popular way of perceiving the development of countries:



What can we measure?

Development might seem to be rather abstract when it comes to measuring it.

However, we can name some of the factors being measurable:

Gross national product (GNP)- “which is the market value of all products and services produced in one year by labor and property supplied by the residents of a country. Unlike Gross Domestic Product (GDP), which defines production based on the geographical location of production, GNP allocates production based on ownership.” 
Source: Wikipedia

- Nutrition

- Services

- Money earned within the country

HDI Actually, there is a very successful way of measuring it i.e. “HDI- human development index which is a composite statistic of life expectancy, education, and income indices to rank countries into four tiers of human development. It was created by economist Mahbub ul Haq, followed by economist Amartya Sen in 1990, and published by the United Nations Development Programme.”





Limitations Of Measuring Development In Terms Of Money

It could be quite obvious that the best way of measuring development is taking money into consideration? Is that really a good idea? Does it have any limitations? Yes, indeed, it has some. First of all, we should remember that the value of different currencies changes drastically, which disenables us to compare them. Moreover, it is rather impossible to compare services- firstly there are two different types of them: personal and domestic and, what is more, are worth different amounts of money. What about the money which is not invested in international transactions? Furthermore, there are some countries in which national income is defined differently. This is one of the main results of Second World War. Then, we meet a difficulty of comparing two nations’ standard of living. How can we do that? By taking average people without any access to water or good sanitation? That will never be precise when it comes to the development of poor people. We should take it under consideration while talking about the development, right? The improvement of standards of living in rural areas should be also a significant indicator, since the government should be focused on helping people in the most hopeless situations. Hence, how to measure it? There is no practical way, as it appears. Since we have no data of the money distribution within a given country, we cannot decide whether the standard of living of the poorest people has improved. In some places huge amounts of money must be spent on healthcare whilst in others on transport or nutrition. What does it mean? Well, the more different needs of the countries are, the more difficult it becomes to measure and compare their level of development. Concluding, I would say that there is no optimal way of measuring it in terms of money but there exist some indicators which can enable us to gain some practical information. 

Source
 an article touching the topic of measuring the development progress

Examples of discussion questions:

  • Why do you think measuring development is so important in today’s world? 
  • Have you noticed that on the first map Poland is one of the ‘second world’s’ countries while on the map by HDI it is one of the most developed countries? Why is that so? Do you think Poland is a developing country or is it likely to collapse?

5 comments:

  1. This topic is really difficult to speak about it, because i am not an economist. There is the whole predicting and forecasting thing in it. So i think this is important for the whole world to predict something bad and try to avoid it, but also there are bad speculations which can ruin everything, and i guess this is the biggest part of these calculations and predictions. They are manipulated, and they make more problems than they solve... Can't really answer your first question :) but i have an answer for the 2nd question and it is - yes, Poland is developing very quick and there is opportunity for IT and ICT to raise the level of development of our country. We should stay here and take care of this market. Because we have a power to do that and it is in our determination and knowledge, also willingness to learn new things and this wild desire for making our american dreams come true here in Poland. So let's go to work! don't really know how it is presented in numbers, but numbers can only measure numbers :) there are tons of unnamed feelings in polish people. But we all want to build something, at the same we are scared of it and we hate our country for the actual condition.

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  2. 1. it is very important to measure the county's development in order to see how valuable each country is. In other words,without having some type of measurement in place, economists would not be able to predict and estimate the current situation in a given country. Also every country would be seen equally,yet, in reality totally different in relation to money, jobs or even people's behaviour. Even though,it is quite a difficult task and not always 100 % accurate,it is essential for the future and further development of countries.
    2. I totally agree that Poland is in the developing stage and it has not reached its full potential as yet. Since joining the EU, the county has improved in terms of jobs,education,and people's morals. Poland is on the right path which needs to be continued in order to be a successful country and make its citizens happy.

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  3. One of the aspects of economy is to describe and measure economic activity of a given nation. This process identifies important factors and produces numbers, which enable us to compare developments of countries. As competition is one of the features of human nature we use these numbers to compare ourselves with other countries. This is important as we can use it to identify countries, which are better develop than ours and possibly adopt their techniques to improve development of our nation. It also allows us to identify our own strengths and weaknesses to work on them and improve upon them further. The other aspect is that it allows us to recognise the poorest countries and form organisations aiming at developing projects to support them.

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  4. I think that the measurement of development is a very important thing in today's world. This avoids a lot of bad things, or predict the onset of the crisis in a country, or to establish where they are food shortages, so we can start work earlier can be initiated any action to prevent such a state. With this measurement, you can find out which of the fastest developing countries in economic terms, if you want to invest in a country that we need such information.
    I think that Poland is definitely a developing country, a lot of new things appear in Poland, many new investors who want to invest in this country.

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  5. Measuring development has become very important factor in our modern world. How development is measure depends on how it is defined; traditionally development was measured by looking at the economic criteria, and that leaded to the general distinction between ‘rich’ and ‘poor’ nations (developed or less-developed). However, I believe that measuring economic development is not really important since there are many problems with using money to assess development, for instance GPN do not really gives any indication on how money/wealth is really distributed within a particular country. Therefore, I believe it is important to measure not only economic development but also quality of people’s life, health, social justice or education.  By collecting those data we can try to establish better educational or health care systems in different countries in the world, and by doing so we can improve quality of peoples’ lives.


    Poland is one of the fastest growing in the EU. Since, for instance, when look at the HDI statistic, it is at the highest position in the world. Therefore, in my opinion Poland should be considered as a highly developed country by both social and economic factors.

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