Class 10 Economics Chapter 1 – Development Note

Topics Covered

Traditional Notion of Development       

Income and other Goals

National Income and per capita Income     

Comparison between different countries

Sustainable Economic Development 

Human Development

The idea of development or progress has always been with us. We have aspirations or desires about what we would like to do and how we would like to live. Similarly, we have ideas about what a country should be like. What are the essential things that we require? Can life be better for all? How should people live together? Can there be more equality? Development involves thinking about these questions and about the ways in which we can work towards achieving these goals.


Development and Goals of Different Categories of Persons

Category of Persons Development Goals
Landless rural labours More days of work , Better wages, social and economic equality.
Rich Farmer Low price food grain, cheap labour, higher price for their produce, cheap inputs like seeds, machinery.
Traders Infrastructure facilities, less taxes, cheap labour, high price for their product.

It means

  • Different persons can have different development goals.
  • What may be development for one may not be development for the other. It may even be destructive for the other.

Traditional Notion of Development

With the independence of the third world countries there arose a need for economic development. Till 1960s, the term economic development was generally used as a synonym of economic growth. But now it is no longer considered identical with economic growth.

Definitely notion about the meaning of term development is changing but it is also a hard fact that there is no unanimity among economists with regard to the meaning on definition of economic development.

However all agree that economic development is more than the economic growth. Hence it is taken to mean growth plus progressive changes in certain variables of material welfare.

Changes in the traditional notion of development :

The increase in income is not sufficient for a nation. Income can be a major base of economic growth of a nation. But experiences had shown that economic growth could not automatically translated into the improvement of levels of living of the poor masses. Therefore, economists redefined the concept of economic development in terms of the reduction of poverty, unemployment and inequality in the context of a growing economy

Now-a-days redistribution and growth have become the popular slogan in most of the progressive nations, including India. The concept of economic growth is related to the increase in output of goods and services in a economy. This can be expressed in two ways :

  1. Increase in total output or increase in gross domestic product (GDP) : and
  2. Rise in per capita income or rise in per capita  GDP.

Economic development is a broader concept than economic growth. Development concerns not only man’s material needs but also the improvement of social conditions of life. It is, there fore not only economic growth but growth plus change in social, culture and institutional pattern. It includes both growth aspect and distribution aspect. Development must, therefore, be conceived of as a multi-dimensional concept.

Income & Other Goals

Income is the most important component of development. Besides seeking more income one way or the other, people also seek things like equal treatment, freedom, education, security, respect of others, job, peace, pollution free environment etc. All these are important goals. In some cases these may be more important than more income. Money or material things that one can buy with it, is one factor on which our life depends. But the quality of our life also depends on non material things.

National Development

Features of National Development.

  1. Only those programmes and policies are implemented which would benefit a large number of people.
  2. It is very important to decide about the conflicts and their solutions.
  3. We have to think whether there is a better way of doing things.
  4. The government decides what would be fair and just path for all.

How Different Countries are Compared

National Income : The total volume of all the goods and services produced within a country plus income coming from abroad.

Per capita Income : When the total National Income is divided by the total population, it is called per capita income.

World Bank has given the following criteria in classifying countries.

Countries with per capita income of 12,056 per annum and above in 2017 are called rich countries and those with per capita income of $ 955 or less are called low income countries.

India comes in the category of low middle income countries because its per capita income in 2017 was just $ 1820 per annum.

Human Development

Factors which contribute to the human development :

  1. Living a long and a healthy life.
  2. To have education, information and knowledge.
  3. Enjoying a decent standard of living.
  4. Enjoying basic fundamental rights.
  5. To have equality and enjoyment of human rights.

Importance of Human Development :

  1. It indicates the level of development of a country.
  2. It indicates to a country how far it has travelled and how far it has yet to travel to achieve a high rank.
  3. Through it one comes to know the important elements of economic welfare.

Two indicators of Human Development :

  1. National Income
  2. Per Capita Income

Human Development :

It is the process of enlarging people’s choices as well as raising the level of well being so that they can lead a purposeful and creative life.

Difference between Human & Economic Development :

Human Development Economic Development
1. It is a broader aspect of development as it includes monetary as well as non monetary aspects. 1. It is a narow concept as it includes only monetary aspects.
2. It is the process of both qualitative and quantitative growth 2. It includes only quantitative growth.
3. It is the final goal of all development 3. It is a means to achieve human development.

Components of Human Development :

Human development index studies the following three basic human capabilities.

  1. Longevity : It means life expectancy in years of the people of a country. The greater the life expectancy, the more developed the country is life expectancy in India 64 years where as in case of developed countries like that of Japan it is more than 70 years.
  2. Educational attainment : Knowledge is the second criteria of human development. It refers to the education attained by the people of the country on an average basis. Knowledge is measured by education attainment i.e. adult literacy and combined enrollment ratio in primary, secondary and tertiary levels.
  3. Real per capita Income : It refers to the average income earned by the people of country. Increase in real per capita income is considered the true indicator of human development.

Limitations of per Capita Income :

  1. A rise in per capita income is due to rise in prices and not due to increase in physical output. It is not a reliable index of economic development.
  2. National income rises but its distribution makes the rich-richer and poor poorer.
  3. It excludes all non marketed goods and services, even though they may be important for human happiness and better quality of life.
  4. Rise in per capita income may be due to use of modern capital intensive technology in production which may be labour displacing in nature thus adversely affecting the poor masses.
  5. If the rate of population growth, is higher than the rate of growth of national income, this will lead to fall in percapita availability of goods and services and economic welfare.

Sustainable Development and Quality of life

Sustainable Development :

It is that process of economic development which aims at maintaining the quality of life of both present and future generation without harming natural resources and environment.

CBSE Note Class 10 Economics Chapter 5 – Consumer Rights

Features of sustainable Development :

Efficient use of natural resources :

It means that natural resources and environment should be used in efficient manner as to achieve long term net objective like increase in income and employment, abolition of poverty, improvement in standard of living etc.

No reduction is the quality of life of the future :

Sustainable development aims at making use of natural resources and environment for raising the existing standard of living in such a way as not to bring down the quality of life of future generation.

No increase in pollution :

It decries those activities which in order to maintain existing high standard of living prove detrimental to natural resources and environment.

Does not limit development :

It does not aim at limting economic development. Its objective is that natural resources and environment be used in such manner as to maintain not only be present but also the future rate of economic developments.

GLOSSARY

  1. Developed Economies : These are those economies which are characterised by high level of percapita income and high standard of living.
  2. Developing Economies : Those economies which are passing through the stages of growth and development. In such economies significance of agriculture tends to decline whereas the industrial sector grows sharply. e.g. India, Indonesia.
  3. Economy : It is a sum total of all the economics activities like production, consumption, distribution exchange etc.
  4. National Income : It is the total value of all the goods and services produced within a country plus net income from abroad during a year.
  5. Production : When an activity results in a valuable and useful things it is called production.
  6. Per capita Income : It is the average income of the people of country in a definite period.
  7. Under-Developed Economies : These are the economies which are characterised by low level of per capita income and miserable standard of living. Such economies are not able to exploit their natural resources. e.g. Nepal, Burma etc.
  8. Infant Mortality Rate or IMR : Indicates the number of children that die before the age of one year as a proportion of 1000 live children born in that particular year.
  9. Literacy Rate : Measures the proportion of literate population in the 7 and above age group.
  10. Net Attendance Ratio : Is the total number of children of age group 6–10 attending school as a percentage of total number of children in the same age group.

Asked Questions

Very Short Answer Type Question

  1. What is development ?
  2. What is national income ?
  3. What is per capita income ?
  4. Why do you think the average income is an important criterion for development ?
  5. What is Infant Mortality Rate ?
  6. What is literacy rate ?
  7. Why Kerala has a low Infant Mortality Rate ?
  8. What is sustainable development ?
  9. Mention any two important aspects of our lives other than income.
  10. What is Human Development ?
  11. Mention two features of development.
  12. Why is the issue of sustainability important for development ?
  13. State the criteria used to compare the different countries by the Human Development Report published by the United National Development Programme (UNDP)
  14. Mention two developmental goals of landless rural labourers.
  15. Why has Kerala a higher Human Development Index than Punjab in spite of low per capita income ?

Short Answer Type Question

  1. Distinguish between Human development and economic development.
  2. Explain two main reasons for the need of environment friendly growth and two suggestion to achieve them.
  3. Describe briefly four steps taken by the Indian government for raising the status of women at par with that of men.
  4. “Different persons can have different development goals”. Explain.
  5. What is the importance of Human development index ?
  6. ‘Human development is the essence of social development’. Explain.
  7. What are the limitations of the per capita income criteria of development ?
  8. While average income is useful for comparison but it may hide disparities. Discuss.
  9. What is Net Attendance ratio ?

Long Answer Type Question

  1. Explain the main achievements of the government of India in the improvement of health status of the people after 1947.
  2. What is the main criterion used by the world Bank in classifying different countries ? What are the limitations of this criterion ?
  3. Is it correct to say that environmental degradation is not just a national use ? Illustrate with examples.
  4. Explain the features of the sustainable development ?
  5. Explain the component of Human Development.
  6. ‘What may be development for one may not be development for the other’. Explain by giving examples.
  7. What is national development ? What are the aspects covered under the national development ?
  8. What contributes to the human development ?
  9. ‘Money cannot buy all the goods and services that one needs to live well.’ Explain.
  10. Distinguish between developed and underdeveloped countries.

CBSE Note Class 10 Economics Chapter 2 – Sector of Indian Economy

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