The Development Gap

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Food Crisis 2008:

Food prices rose sharply worldwide after 2006. Rice prices rose by 70% between 2007 and 2008. Price increases were the result of global grain shortages caused by;

poor harvest after extreme weather in Europe and North America

growth of biofuels which reduced amount of land under food cultivation

rising demand in rice exporting countries where rising incomes and food consumption reduced amount available for export

rising demand for cattle feed in Saudi Arabia

hoarding of food by traders expecting price increases

During food crisis' poorer countries have poorer food security because of high import costs

The Development Gap:

The geography of the development gap is more complex than the north-south divide

Latin America has HDI levels similar to that of Eastern Europe, China's HDI levels and some others in Southeast Asia are relatively high

South Asia has a concentration level of below 0.6

Levels in the Middle East are relatively high although not in Yemen, Syria and Iraq

The picture of Africa is very complex with the extreme north and south having decent HDI levels but some regions having shockingly low numbers

How can we measure development?

GDP

Political stability

Women employment

Crime levels

Economic activity

Calories per person per day

Death/birth rates

Life expectancy

Ratio of doctors per person

Electricity consumption

Number of computers per person (televisions/telephones)

Water access

Standard of water pipes

Age range of education

% of higher education graduates

Average income

Purchasing Power Parity (PPP):

The difference in how much goods and services really cost is why PPP GDP income is used rather than only raw GDP. E.g. One country may only earn £5000 but they can get the same as what we can with £10,000. PPP makes things equal so we can compare them.

An economic theory that estimates the amount of adjustment needed on the exchange rate between countries in order for the exchange to be equivalent to each currency's purchasing power. Purchasing Power Parity is used worldwide to compare the income levels of different countries.