Mcc11447 Ch39W 001 020
Bonus Web Chapter
AFTER READING THIS CHAPTER, YOU SHOULD BE
ABLE TO:
1 Describe how the World Bank distinguishes between industrially advanced countries (highincome nations) and developing countries (middleincome and low-income nations).
39
WEB
www.mcconnell19e.com
2 List some of the obstacles to economic development. 3 Explain the vicious circle of poverty that afflicts low-income nations.
4 Discuss the role of government in promoting economic development within low-income nations.
5 Describe how industrial nations attempt to aid low-income countries.
The Economics of Developing
Countries
It is difficult for those of us in the United States, where per capita GDP in 2009 was about $48,000, to grasp the fact that about 2.5 billion people, or nearly half the world’s population, live on $2 or less a day. And about 1.4 billion live on less than $1.25 a day. Hunger, squalor, and disease are the norm in many nations of the world.
In this bonus Web chapter we identify the developing countries, discuss their characteristics, and explore the obstacles that have impeded their growth. We also examine the appropriate roles of the private sector and government in economic development. Finally, we look at policies that might help developing countries increase their growth rates.
39W-1
39W-2
PART ELEVEN
International Economics
The Rich and the Poor
Comparisons
Just as there is considerable income inequality among families within a nation, so too is there great income inequality among the family of nations. According to the
United Nations, the richest 20 percent of the world’s population receive more than 80 percent of the world’s income; the poorest 20 percent receive less than 2 percent.
The poorest 60 percent receive less than 6 percent of the world’s income.
Several comparisons will bring the differences in world income into sharper focus:
• In 2008 U.S. GDP was $14.6 trillion; the combined
GDPs of the 144 DVCs in that year added up to
$15.6 trillion.
• The United
AFTER READING THIS CHAPTER, YOU SHOULD BE
ABLE TO:
1 Describe how the World Bank distinguishes between industrially advanced countries (highincome nations) and developing countries (middleincome and low-income nations).
39
WEB
www.mcconnell19e.com
2 List some of the obstacles to economic development. 3 Explain the vicious circle of poverty that afflicts low-income nations.
4 Discuss the role of government in promoting economic development within low-income nations.
5 Describe how industrial nations attempt to aid low-income countries.
The Economics of Developing
Countries
It is difficult for those of us in the United States, where per capita GDP in 2009 was about $48,000, to grasp the fact that about 2.5 billion people, or nearly half the world’s population, live on $2 or less a day. And about 1.4 billion live on less than $1.25 a day. Hunger, squalor, and disease are the norm in many nations of the world.
In this bonus Web chapter we identify the developing countries, discuss their characteristics, and explore the obstacles that have impeded their growth. We also examine the appropriate roles of the private sector and government in economic development. Finally, we look at policies that might help developing countries increase their growth rates.
39W-1
39W-2
PART ELEVEN
International Economics
The Rich and the Poor
Comparisons
Just as there is considerable income inequality among families within a nation, so too is there great income inequality among the family of nations. According to the
United Nations, the richest 20 percent of the world’s population receive more than 80 percent of the world’s income; the poorest 20 percent receive less than 2 percent.
The poorest 60 percent receive less than 6 percent of the world’s income.
Several comparisons will bring the differences in world income into sharper focus:
• In 2008 U.S. GDP was $14.6 trillion; the combined
GDPs of the 144 DVCs in that year added up to
$15.6 trillion.
• The United