Sustainable

Development

Gourgiotis KonstantinosΑsimina-Aikaterini Makarezou

Μary Chonianaki

๏ The increase of national wealth improves quality of life?

✓ Even if the indicators of the national wealth can show development,

though they don’t provide proper info about the allocation of: Free

health, education services, employability, κ.ο.κ. (QoL)

๏ Does the increase of national wealth contributes to human

development?

✓ Human Development Report 1996, published by the United Nations

Development Program, “human development is the end—economic

growth a means.”

What is development?

What is development?

๏ Historically speaking: Economic growth hasn’t lead to human

development (unemployment, weakened democracy,

overconsumption of natural resources)

๏ if environmental and social/human losses resulting from economic growth

turn out to be higher than economic benefits (additional incomes earned by

the majority of the population), the overall result for people’s wellbeing

becomes negative.

๏ According to the Human Development Report 1996, “during 1960–1992 not

a single country succeeded in moving from lopsided development with slow

human development and rapid growth to a virtuous circle in which human

development and growth can become mutually reinforcing.”

Sustainable Development

Sustainable Development is a new term:

Classical definition given by the United Nations World Commission

on Environment and Development in 1987 development is

sustainable if it “meets the needs of the present without

compromising the ability of future generations to meet their

own needs.”

Balancing those three diverse objectives = challenge for every

country:

Economic

Environmental

Social

International cooperation is necessary for sustainable development.

War and poverty are obstacles!

Sustainable Development

Comparing Levels of Development

Past: Countries are unequally endowed with natural

resources

Present: Α wealth of natural resources is not the most

important determinant of development success

Conclusion main indicator of the level of economic

development: productivity

physical capital, human capital, and natural capital

Calculation of productivity

Gross domestic product (GDP): the total final output of all

goods and services produced in a single year within a

country’s boundaries

Gross national product (GNP): GDP +incomes received by

residents from abroad

1. GDP ή GNP = wages plus interest plus profits plus rents.

2. GDP ή GNP = consumption plus investment plus

government purchases of goods and services, and net

exports (exports minus imports).

Per capita income

𝐆𝐍𝐏/𝐆𝐃𝐏

𝒄𝒐𝒚𝒏𝒕𝒓𝒚′𝒔 𝒑𝒐𝒑𝒖𝒍𝒂𝒕𝒊𝒐𝒏= per capita GNP/GDP

Disadvantages GNP and GDP per capita: They do not

show:

pollution, environmental degradation, and resource

depletion

unpaid work

the distribution of income and incidence of poverty

Purchasing power parity (PPP)

Number of units of a country’s currency required to buy the same

amount of goods and services in the domestic market as one dollar

would buy in the United States

nominal GNP per capita

Real GNP per capita : an indicator adjusted for the difference in prices for the

same goods and services between a country and the United States

Developing countries:

Real > Nominal GNP per capita

≠ Developed

Grouping Countries by Their Level of Development

Different criteria to group countries by their level of development

o Most popular: • Developed• Developing

o The World Bank: GNP per capita (α) low-

income, (β) middle- income, (γ) upper-middle-income,

(δ) high-income,

Grouping Countries by Their Level of Development

The relatively accurate classification of countries into

“developing” and “developed” based on their per capita

income does not, however, work well in all cases:

- Israel, Kuwait, Singapore, and the United Arab Emirates.:

These countries are considered developing because of

their economic structure or because of the official opinion

of their governments, although their incomes formally

place them among developed countries

GDP Growth

• 1965-1999 the average annual growth rate was 4.1 percent in low-

income countries.

• Will the poor countries reach the rich one? No, the gulf between the

average GNP per capita in developing and developed countries

continues to widen, because of the population growth.

Predictions

Only 10 of the developing countries will reach in the next 100 years the developed countries.

The poorer a country is, the harder it is to maintain the high volume of investment

Such economic growth can be socially unsustainable–leading to social stress and conflict, detrimental to further growth

• Soubbotina P. T. & Sheram K.A. (2000). Beyond economic growth, Meeting the

Challenges of Global Development. Washington, D.C.: The World Bank.

Reference