Approaches to development: top-down

Approaches to development: top-down

1. modernisation

   • Rostow's modernisation model shows that countries can move through 5 stages of economic growth in order to develop. the model suggests countries should adopt capitalist and neo-liberal practices.
     • TAIWAN
       • government encouraged industrialisation through land reforms and economic reforms by setting up 'special economic zones'/ 'export processing zones.' 1967 US TNC Mattel set up a factory in rural Taishan. 1981 Taiwan's own TNC Acer (IT equipment) began to export to international market. today it is the 6th largest PC company in the world.
         • positives for Taiwan: higher incomes, access to education, better spending - positive multiplier effect. GDP per capita based on PPP is $46,000. 0% absolute poverty rates. 1 in 6 people are business owners. empowerment of women due to more employment opportunities
         • negatives for Taiwan: heavy pollution with 1 factory per km2. reliance on nuclear energy due to high demand. nuclear waste is exposed of on Orchid Island where the population has seen an increase in rates of leukemia. prevalence of cancer doubled in the period 1960-1990. only 1% of human waste is treated. ranks 135 out of 138 countries on the global pollution index
     • Criticisms of the modernisation model
       • a dated theory current during the Cold War...... deterministic and some countries can skip stages e.g. China........ Eurocentric..... anti-traditional religion...... economically driven so human development may slow.
     • iNDIA
       • The building of dams affirm a commitment to modernisation in post-independence India
         • Koyna Dam, Maharashtra constructed in 1963. 100 meters high. supplies water and cheap HEP
           • Social impacts: 100,000 people displaced - 40% of which were tribal. less than 50% have been rehabilitated . rehabilitation schemes don't cover landless labourers, fishermen or artisans - discrimination leading to loss of livelihood and reduction in quality of life
           • economic impacts: India's GDP per capita is only $1,700. The average cost overrun of large dams is 90%. India is heavily indebted and the value of its currency (rupee) is of less value compared to the dollar
     • MEKONG RIVER
       • China plans to build a total of 19 mega-dams for HEP and creation of reservoirs along the Mekong, which spans six countries
         • social/economic impacts: many plans are developing without consultation with smaller communities downstream - excluded from decision making. people rely on the river as a source of nutritious fish, income from fishing or tourism and as an environment in which to grow crops. Dams could threaten fish species and stagnant reservoirs reduce the water quality
         • environmental impacts: in Cambodia, the building of two dams could wipe out the endangered dolphin species that is indigenous to the Mekong. this would impact the wider food web, ecosystem and biodiversity. Dams could reduce flooding and flow patterns of the Mekong which could reduce the transport of sediments downstream which provide mineral for fertile soil and therefore effective agricultural production
         • large dams can take on average 9 years to complete meaning that they are vulnerable to currency volatility, hyperinflation, political tension and changes in water availability
   • government led approach which focuses on industrialisation, urbanisation and increased use of technology
     • limitations of modernisation theory
       • assumes that western forms of capitalism is best and implies that traditional values and institutions have little or no value compared with their western equivalents.......... ignores social/economic problems that are common in societies e.g. poverty, suicide, crime.................. underestimates the external obstacles to development e.g. international conflict, climate change......... western encouragement of LDC elites has created inequalities in wealth and power which has widened the development gap
   • 1950's

2. colonialism (cultural imperialism) : cultural domination of a territory and its people by a foreign power for an extended period of time

   • 16th century European nations founded colonies continued through the first half of the 20th century. British colonial efforts were justified by 'white mans burden' which asserted that native peoples were not capable of governing themselves. for example European colonialism in 1930's removed aboriginal children from their families- the 'lost generation'

3. dependency theory

   • criticisms of modernisation theory of development in the 1960's. developed nations are responsible for the underdevelopment of the third world. Andre Frank dependency model outlines how the peripheral countries are reliant on the core areas for investment whilst the core regions exploit their natural resources and cheap labour force.
     • 'Oil curse' in Nigeria
       • Nigeria is a member of OPEC and oil/gas exports account for 90% of its export earnings. failure to develop its manufacturing industry.
         • social impacts: HDI is 142/169 countries........ lack of basic infrastructure and social services........ TNC like Shell enter the area leading to westernisation and cultural erosion...... there has been cases of the Nigerian government forcibly removing communities from an area by shooting elders and burning down houses in order to clear the land for Shell to begin drilling e.g. Odiama village......... decline in traditional agriculture
         • economic impacts: profits remain in the hands of corrupt government officials - inequality........ failure to develop its manufacturing industry due to focus on oil wealth means its way behind other African nations in terms of economic growth and social development

4. neoliberalism

   • free trade, less government interference, less government protection of industries, removal of barriers to trade, creation of free market and privatisation of basic services. 1980's - World Bank and IMF, Margaret Thatcher and Ronald Reagan had adopted this method for development. they claimed that privatization would led to increased efficiency due to competition . 'trade not aid' approach.
     • Negatives of neo-liberalist approach
       • privatization leading to economic water scarcity and tensions between governments and TNCs: TANSANIA. in 2003, City Water (subsidiary of UK TNC BiWater) took over water supply in Dara es Salaam. the World Bank promised a $140 million loan to government only if they privatized their water supply. after City Water took over water fees increased and 25% of peoples incomes were spent of water bills. some people had running water only 3 times a week. poorer people are forced to get water from dirty wells that causes illness like cholera.
   • telecommunications in India 1991: before privatization, the government provided telephony. there was excess demand and insufficient supply with customers having to wait years for a phone connection. Now customers have a choice of operators, cheaper prices and better quality connection. there is increased tele-density leading to social development; awareness of human rights, job opportunities, news/current affairs increases participation. M-Pesa is a mobile money transfer service launched by Vodafone in 2013. easy access to credit will encourage business start ups and economic development
     • Hindustan Lever limited in India is a subsidiary of Unilever. the private firm has worked with the government, aid agencies and NGO's to start educational programmes about hygiene and avoiding infections by using lifebuoy soap
   • World Bank 1980's - 1990's worked with US and Western Europe led neo-liberal approach. Right wing approach. since 2000 more social and environmental perspectives. promotes community driven development. $1 billion to India to build sewage treatment plants and revamp drains on the river Ganges, which supports 400million people
   • WTO - rich countries have control over the WTO. it encourages economic policies associated with free trade and investment by TNCs. 'seven deadly rules' include limiting the use of agricultural subsidies and a country is restricted from raising barriers against cheap imports