Measuring Development
"This index measures a country's development using life expectancy, education, and income per capita."
What is the Human Development Index (HDI)?
"Mining, farming, and fishing are all examples of this economic sector."
What is the primary sector?
"According to Wallerstein's World Systems Model, wealthy, industrialized nations that dominate global trade are called this."
What are core countries?
"These manufacturing plants located along the U.S.–Mexico border take advantage of cheap Mexican labor while staying close to U.S. markets."
What are maquiladora plants?
"This type of small loan, often given to entrepreneurs in LDCs who cannot access traditional banking, helps stimulate local economic development."
What is microfinance?
"This measure adjusts income comparisons between countries to account for differences in the cost of living."
What is Purchasing Power Parity (PPP)?
"A soft drink bottling facility is an example of this type of industry, because it adds weight and bulk to its product during manufacturing."
What is a bulk-gaining industry?
"These countries — Brazil, Russia, India, China, and South Africa — are often cited as rapidly industrializing semi-periphery nations."
What are the BRICS countries?
"This production system, associated with Henry Ford, relied on assembly lines, mass production, and large numbers of semi-skilled workers at a single location."
What is Fordism/Fordist production?
"This trade movement guarantees farmers and producers in developing countries a minimum price for their goods, aiming to reduce exploitation."
What is fair trade?
"Unlike GDP, this measure counts income earned by a country's residents anywhere in the world, not just within its borders."
What is Gross National Income (GNI)?
"This type of industry has no strong pull toward any particular location because transportation and labor costs are not a significant concern."
What is a footloose industry?
"This development strategy argues that a country should focus on producing and exporting what it produces most efficiently, rather than trying to be self-sufficient."
What is the international trade model / comparative advantage approach?
"When a company moves production or services to another country to reduce costs, this is the general term for that process."
What is outsourcing?
"This phenomenon describes how initial investment or economic growth in a region attracts further investment, businesses, and workers, compounding over time."
What is cumulative causation?
"This index measures gender-based inequalities in reproductive health, empowerment, and labor market participation."
What is the Gender Inequality Index (GII)?
"Weber's Least Cost Theory identifies these THREE main costs a firm must minimize when choosing a factory location."
What are transportation costs, labor costs, and agglomeration economies?
"Dependency Theory argues this is the primary reason why periphery countries remain underdeveloped."
What is the continued economic exploitation and reliance on core countries, which extracts resources and wealth from periphery nations while keeping them dependent on external financing and trade relationships?
"Identify TWO industries most likely to outsource jobs overseas due to slight increases in domestic labor costs, and explain why."
Examples include: call centers/customer service (require only language skills and basic training, easy to relocate); garment/textile manufacturing (highly labor-intensive, thin margins); electronics assembly (repetitive, low-skill tasks). Labor costs are a dominant share of total production costs in these industries.
"Explain how increasing girls' secondary school enrollment in developing countries impacts economic development and population growth."
Higher female education leads to lower adolescent fertility rates, later marriage, smaller family sizes, and higher female workforce participation — all of which reduce poverty, increase per capita income, and improve HDI indicators over time.
"A country has a high GDP per capita but low HDI ranking. Name TWO possible reasons for this discrepancy."
Possible answers include: extreme income inequality (wealth concentrated among few), poor access to education, low life expectancy due to disease or conflict, high maternal mortality rates, or limited access to healthcare.
"Explain why automotive manufacturing tends to locate in MDCs rather than LDCs, despite lower labor costs in LDCs."
Automotive plants require advanced infrastructure, skilled labor, reliable supplier networks (ancillary industries), proximity to large consumer markets, and capital-intensive technology — all of which are more readily available in MDCs.
"Describe Rostow's Stages of Economic Growth model, identifying all five stages and giving a characteristic of each."
(1) Traditional Society — subsistence agriculture dominates; (2) Preconditions for Takeoff — infrastructure and trade begin; (3) Takeoff — rapid industrialization begins; (4) Drive to Maturity — diversified economy, tech advances; (5) Age of High Mass Consumption — consumer goods dominate, services expand.
"Analyze the impact of the 'New International Division of Labor' on BOTH MDCs and LDCs."
MDCs experience deindustrialization — loss of manufacturing jobs, growth of service/quaternary sectors. LDCs gain low-wage factory jobs but may face exploitation, commodity dependence, and limited advancement. The new IDL shifts raw production to periphery nations while MDCs retain high-value design, management, and R&D roles.
"Compare 'austerity' and 'stimulus' as economic policy responses to recession, and explain the core argument each side makes."
Stimulus involves government spending to boost demand and employment (Keynesian approach — inject money to restart growth). Austerity involves cutting government spending and debt to restore investor confidence and long-term fiscal stability. Stimulus advocates argue austerity deepens recessions; austerity advocates argue stimulus creates unsustainable debt burdens, especially harmful for LDCs seeking international financing.