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Ch 1Development

Board exam (part of Economics 20 marks)

Chapter 1: Development

What Development Promises โ€” Different People, Different Goals

Development involves thinking about the kind of life we want, and the questions of what a country should be like. The central idea of this chapter is that different persons can have different developmental goals, and what may be development for one may not be development for another โ€” it may even be destructive for the other (e.g. a dam that gives electricity to industrialists may displace tribal families).

Category of PersonDevelopmental Goals / Aspirations
Landless rural labourersMore days of work and better wages; local school able to provide quality education for their children; no social discrimination; they too can become leaders in the village
Prosperous farmers from PunjabAssured high family income through higher support prices for crops and hardworking, cheap labourers; ability to settle their children abroad
Farmers who depend on rainsAssured means of irrigation so that crop failure does not ruin them
A rural woman from a land-owning familyRegular income, her own share in the family property, freedom and dignity in decision making
Urban unemployed youthA secure, well-paid job matching their qualifications
Adivasis from Narmada valleyNot to be displaced from their land and forests; continued access to their traditional sources of livelihood
Exam tip: When asked "Why do different people have different developmental goals?", answer with the logic โ€” people's goals depend on their life situations (occupation, income, region, gender). Always add the classic line: "What may be development for one may not be development for another."

Income and Other Goals

People desire regular work, better wages and decent prices for their produce โ€” i.e. more income. But money cannot buy everything. People also seek non-material / other goals:

  • Equal treatment and freedom from discrimination
  • Security and respect โ€” a job with security may be preferred over a higher-paid job with no security (e.g. a job in a far-off city with no family time)
  • Freedom, dignity of women โ€” a safe and secure environment allows more women to take up jobs or run businesses
  • A pollution-free environment and good facilities for the family

The developmental goals people have are therefore a mix of income and other important things in life. For development, people look at a mix of goals, and the goals must not harm others.

National Development and How to Compare Countries

Just as individuals differ, ideas of national development also differ. We need a fair and just path for all โ€” whether more benefit for a large number of people should be preferred. For comparing countries, income is considered the most important attribute. But since countries have different populations, total income does not tell us what an average person earns. Hence we compare the average income = per capita income:

Per Capita Income (Average Income) = Total income of the country รท Total population

In the World Development Report (2023), brought out by the World Bank, countries are classified by per capita income:

  • Rich (high-income) countries: per capita income of US$ 13,845 per annum and above (2022). Rich countries, excluding Middle East countries and certain other small countries, are generally called developed countries.
  • Low-income countries: per capita income of US$ 1,085 or less. India is in the low middle income category (per capita income about US$ 2,380 in 2022).

Limitations of Average Income โ€” Hidden Disparities

Averages are useful for comparison but they hide disparities in distribution. Consider the NCERT-style example of two countries with five citizens each:

CountryMonthly incomes of 5 citizens (Rs)Average income (Rs)
Country A9,500; 10,500; 9,800; 10,000; 10,20010,000
Country B500; 500; 500; 500; 48,00010,000

Both have the same average, but most people would prefer to live in Country A because income is equitably distributed โ€” in Country B one person is extremely rich and the rest are poor. Hence, besides average income, we must ask how income is distributed.

Income and Other Criteria โ€” The States Comparison

Even within India, a state with a higher per capita income may lag in human indicators. NCERT compares Haryana, Kerala and Bihar:

StatePer capita income (higher/lower)Infant Mortality Rate per 1,000 (2020)Literacy Rate % (2017-18)Net Attendance Ratio (age 14-15), 2017-18
HaryanaHighest of the three288261
KeralaLower than Haryana69483
BiharLowest276254
  • Infant Mortality Rate (IMR): number of children who die before the age of one year out of 1,000 live children born in that particular year.
  • Literacy Rate: proportion of the literate population in the 7-and-above age group.
  • Net Attendance Ratio: total number of children of age group 14 and 15 years attending school as a percentage of the total number of children in the same age group.

Kerala has a low IMR because it has adequate provision of basic health and educational facilities. Money in your pocket cannot buy all the goods and services needed for a good life โ€” hence income by itself is not a completely adequate indicator.

Public Facilities

Many of the important things in life are best provided collectively โ€” the cheapest and best way is often through public facilities: schools, public health services, PDS (ration shops), safe drinking water, electricity, public transport, pollution-free environment. For example, in states where the Public Distribution System (PDS) functions well (as in Tamil Nadu), the health and nutritional status of people is much better. Kerala's low IMR is directly linked to good public health and education facilities.

Body Mass Index (BMI) is one way to check undernourishment in adults: BMI = weight in kg รท (height in metres)ยฒ. If BMI is less than 18.5, the person is undernourished; above 25, overweight.

Human Development Report (UNDP)

The Human Development Report, published by the United Nations Development Programme (UNDP), compares countries on a broader measure than income โ€” the Human Development Index (HDI), based on:

  1. Per capita income (calculated in dollars, adjusted for purchasing power)
  2. Educational levels of the people โ€” mean years of schooling and expected years of schooling
  3. Health status โ€” life expectancy at birth
BasisWorld Development Report (World Bank)Human Development Report (UNDP)
CriterionOnly per capita incomePer capita income + education + life expectancy
View of developmentNarrow โ€” income aloneBroader โ€” people's health and education as goals in themselves

NCERT notes that Sri Lanka ranks better than India in HDI despite being a much smaller economy, and even Nepal and Bangladesh have lower per capita income than India yet are close or better on some human indicators. Money cannot buy a pollution-free environment or ensure disease-free life unless the community makes collective provisions.

Sustainability of Development

Development must be sustainable โ€” it should continue for future generations. Scientists warn that the present type and level of development is not sustainable:

  • Groundwater overuse: in India, groundwater is an example of a renewable resource being overused โ€” water levels in many regions have fallen because extraction exceeds replenishment (about one-third of the country's groundwater is overused).
  • Exhaustible resources: crude oil reserves of the world would last only about 50 years at present rates of extraction (reserves/annual production); for countries like the USA the position is far more critical, and India imports most of its crude.
  • Consequences of environmental degradation do not respect national or state boundaries.
"We have not inherited the world from our forefathers โ€” we have borrowed it from our children." Sustainability of development is comparatively a new area of knowledge in which scientists, economists, philosophers and other social scientists are working together.
Quick revision โ€” 5 pillars of Ch.1: (1) Different goals for different people, (2) Income + other goals, (3) Per capita income and its limits (averages hide distribution), (4) HDI = income + education + health, plus public facilities/BMI/IMR, (5) Sustainability (groundwater, crude oil). One of these appears in almost every board paper as a 3- or 5-marker.