Chapter 4 – D Block

Increasing Physical InfrastructureWhat is it?

ALL of the things that help a country’s economy – it is the groundwork for economic development

Transportation, Electric Power, Telecommunications, water supply, sewer system

Increasing Physical InfrastructureWhy is it important?

It is REQUIRED for physical capital to operate.Most private sector activities cannot take place is there is inadequate physical infrastructure

This will help the Private Sector do all of that SAVING AND INVESTING we keep hearing about.

Increasing Physical InfrastructureHow do they go about it?

• Repair or build new roads – perhaps one that links a port to a city.

• Modernize ports – dig a channel – buy a crane

• Modernize Railways• Build/improve airports• Hydroelectric Power – other electricity

sources• Telecommunications – exchange of

informationMUST BE CAREFULLY PLANNED – COSTS need to be LOW – BENEFITS need to be HIGH…both long term and short term.

Increasing Industrial Production

What is it 

•      When the governments try to allow the factories and industries more oppuritunities to allow more goods and services.

• One method of accomplishing it is to increasing physical capital or human capital

• Can be done on a micro or macro level          one factory worker-one business-one group of

industries  

Increasing Industrial ProductionWhy is It Important?

• Increasing Industrial Production is important because a developing nation wants to produce the manufactured goods that its people need, produce goods for export to other countries, and to provide  regular jobs for its vast number of unemployed and part-time workers. Also, by increasing industrial production a country is attempting an effort to try and move away from agriculture. 

Needs of the People•  No necessities = no healthy/proper life

Example: clothing, shelter, etc.• No clothing = no healthy/proper life...No shelter = no healthy/proper life

Producing Goods for Export• In order to import or gain money/goods, you must export as much as you import.

        Exports = Imports

Providing Jobs• Providing jobs = people are increasing the GNP of the country• Increase in GNP of a country = increase in the standard of living in a country • Increase in the standard of living in a country = earning more, therefore having extra money left

over to spend on whatever the people of a country feel they need or want.

Increasing Industrial Production

Needs of the People • No neccesities = no

proper health or life• Example: clothing,

shelter, etc.• No clothing = no

healthy/proper life...No shelter = no healthy/proper life

Producing Goods for           Export • In order to import or

gain money/goods, you must export as much as you import.

• Exports = Imports

      Providing Jobs• Providing jobs = people are

increasing the GNP of the country

• Increase in GNP of a country = increase in the standard of living in a country 

• Increase in the standard of living in a country = earning more, therefore having extra money left over to spend on whatever the people of a country feel they need or want.

• Increasing Industrial Production is an essential action a developing nation needs to commit because Industral companies produce the manufactured goods that its people need, produce goods for export to other countries where alot for money is earned, and it provides regular jobs for its vast number of unemployed and part-time workers. Also, by increasing industrial production a country is attempting an effort to try and move away from agriculture. 

.

Increasing Industrial ProductionHow Do They Go About Doing It? • Build Factories that only need a small amount of

capital. • Build Plants that set up for assembly

o assemble finished products with parts imported from other countries ex) refrigerators, calculators etc.

• start with easier, smaller productso with more capital they work on harder and

more complex products For example: Starting with canned fruit and

then working on trucks

Problems that developing nations face when increasing industrial production

  What problems do you think developing nations face when increasing industrial production?                                                                                              

Increasing Agricultural ProductionWhat is it?

• Agricultural production is the goods/crops produced by farming

 • Agricultural production is low in developing nations

 • Low agricultural production results in a lack of food,

low income for farmers, and people losing jobs • Increasing agricultural production results in higher

income, more food, and lower unemployment rate

Increasing Agricultural Production                                            Why is it important• Increasing production in agriculture affects the production of

Industrial buisnesses • They provide consumable goods for which the industrial workers buy, in

order to survive and produce o If the farmers were able to produce more food then more food would

be distributed for lower costs and their primary survival issue has been eliminated

o more people could start looking for a job and the industral and other production would go up along with the employment rate 

o If there was a lack of food because the agriculture workers were unable to produce goods, then no products would be able to be produced

• Increasing production from agriculture is vital because the buisness is very unstable so producing as much food as possible during a good season is essential

• Therefore, Increasign Agricultural Production is important because it is the basis for all other producers

.

• persuade farmers to adopt new farming methods

• build irrigation systems• provide loans to farmers• pay farmers good price for

thier products•  use more land for farming• make farmers the owners of

the land they work• MORE physical capital

 

Increasing Agricultural Production

How can we do it?

Increasing Foreign TradeWhat is it?

• Developing nations must import goods and services to cover for lack of productiono Import needs-that you can't produce, or can't

produce enough of  • Must increase imports and exports• Developing nations also increase connections

with other countries by getting their help.

Increasing Foreign TradeWhy is it important?

 Buy goods and services the country doesn’t produce itself >>Food and oil-Sell goods to other countries to pay for imports • Developing country relying on one or two basic

exports risks chance of prices going down o Makes less money o Has to cut down on imports

• Increase variety, manufactured goods

Increasing Foreign TradeWhy It Is Important

• Once a country increases foreign trade it can:obuy from other countries more of the goods

and services it does not produce itself o sell more of its own good to other countries

in order to pay for the things it importsthus it helps economic development

 

Increasing Foreign TradeHow do they go about it?

• By increasing foreign trade, countries can solve two problems that help the country feed its people and produce goods and services. 

• A country can buy more goods and services from other countries that they do not produce themselves. 

• They could also sell more of their own goods to pay for all of the imports.

• An example of this is if a country has a lot of oil but needed cotton, they would export a lot of oil and use that money to import a lot of cotton. 

Educating and Training PeopleWhat is it?

•  The government supplies more education  • Education systems are made for

 • If a country needs to develop for the better of its people they

need more human capital  

Educating and Training PeopleWhy is it important?

• Educating and training people is important because  • In Order for a country to develop 

 • Every developing country needs an educated

population  

Educating and Training People

How do they go about it?• One role of the government is to work on a good

public education system to ensure that future generations get a good education

• Sometimes, a 5 year plan might include a budget to support the building of school

• One main idea in the building of schools is to give women a chance to get a good education along with men and boys. 

• The government is also responsible for supplying textbooks and other items of that nature 

Assisting the Poorest PeopleWhat Is It?

•When governments assist the poorest people they aim the activities of economic activity more towards their poorest people.

     Asisting the Poorest

PeopleWhy is it important? • Makes good...

1.Political Sense2.Economical Sense3.Environmental Sense

1.Political Sense• narrowing gap between rich and poor

 Ex. In the U.S.A there is always a debate between the democratic party and republican party on who should pay higher taxes..the rich or the poor.

2.Economical Sense• If every one in a country is well educated and medicated their human capital is high. 

Therefore, the country is more productive in making goods/ performing services.• If every one in a country is poorly educated and medicated their human capital is low. 

Therefore, the country is less productive in making goods/ performing services. 3.Environmental Sense• People in absolute poverty tend to use more natural

resources(more abundant/cheap) than wealthier people.Ex. A person might use wood for a fire to keep warm since it can't afford to buy gas and/or energy to heat their home, if they have one.

Assisting the Poorest PeopleWhy it is Important?

  Assisting the Poorest People

How Do They Go About It?Countries assist the poorest people by:

•    Increasing agricultural productiono  Especially of small scale farmers can lead to more jobs

and higher incomes• Creating more Jobs

o Building boatyards, textile mills , workshops in rural areas

• Better living conditions for citizenso Building sewers, water taps, paved roads,  footpaths

 and providing durable building materials [especially to citizens in slums]

• Increasing amount of Physical and Human capitalo More public transportation, vocational training  centers

and schools

Slowing Population Growth

Population Growth is that rate at which a population grows.  In Developing Nations it is higher because of the prestige of a big family*, the old habits of having more kids to ensure survival, and the introduction of vaccines and modern medicine. *A big family is a symbol of wealth and success - big families can help at home on the farm or go off and earn money elsewhere.

Slowing Population Growth

Why is it improtant to address?  It is the most important area of economic development to address.  It should be introduced in the first of any 5 year plans.

why?

because any of the other 6 areas of economic development can be countered by a rapidly growing population

Slowing Population GrowthFor example:  Take Agricultural Production

you increase your Agricultural output so you can 1.) feed your people, and then 2.) export what is left over

But now, you added more mouths to step 1.  leaving just the same small amount of agricultural product to export.

Slowing Population Growth

For example:  You want to educate and train people...so you build a school.

Well if your population growth rate is high - you will soon need two schools, three schools, etc.

Slowing Population GrowthHow to "go about it"

educate Women: if they are out working - then they will be less likely to stay home and raise a fmaily, or they will start a family later in life.

Family Planning Services - explain the logic behind PGR - lay out the economic ramifications of having babies every year.  instead of , say, every 3-4 years.  They can also distribute birth control methods

Slowing Population GrowthHow to "go about it"

give families incentives - "if you only have 2 kids - we will give you a tax break"

Educate young people on the benefits of smaller families.

lower the % of workers in agriculture - the GNP per capita will rise and fewer workers are needed home on the farm.