Reasons for Studying Development Economics

5 Top Reasons for Studying Development Economics:

Here we shall concentrate upon that what is the need behind studying development and what is to be studied in development economics:

(1) Problem of World Poverty: The discipline of Economic Development starts with the problem of backwardness and international poverty. It means why the world has been divided into two opposite poles; the North and the South. In other words, why the development gap between countries of the world is increasing, i.e., the rich countries are getting rich while the poor countries are getting poor. In this respect, the Lorenz curve and Gini co-efficient like measures are employed to measure international inequalities. Therefore, a moral and ethical justification exists to study development economics as a separate body. In addition to know about world poverty, it is the economic development which helps us to know what is the classification of the countries at international level, i.e., how many are developed countries, how many are middle income earners and how many are less developed countries. With this we come across the salient features of developing or poor economies. Thus the economic development, as a subject, helps us to know about the characteristics of developing countries, though these characteristics are diverse and as well as common.

(2) Meaning Of Economic Development: It is the education and the mass media both at the country level and at world level which arouse the feelings in favor of development, i.e., the people of backward countries of Africa, Asia and Latin America became aware of with the concept of Economic Development. The Western experts were of the view that if real GNP and per capita GNP of a country increase over a long period of time it would be given the name of economic development. But later on, a lot of criticism was made against these measures of development. Then the economists engaged themselves in finding other measures of economic development. Accordingly, the social and economic indicator approach, the basic needs approach and the construction of human development index approach have been introduced by the economists and sociologists to measure economic development. Thus in Development Economics we study economic development and different measures which can be employed to measure it.

(3) Models Of Economic Growth: In Development Economies we come across a lot of models of economic growth which present the picture of economic growth of western advanced countries. It means that how the developed nations got growth or what was their route of economic growth. In this respect, we study the growth model as presented by Adam Smith, Ricardo and other classical economists; the neoclassical models of economic growth as presented by J.E. Meade, Robert Solow and Swan etc.; the Schumpeter's model of economic growth; the Harrod-Damar models of economic growth; and many other models of economic growth.

(4) Theories Of Under-Development And Development: Development Economics also presents a lot of theories regarding the under-development of the poor countries as well as the theoretical means and ways through which the poor and backward nations of the world can attain economic development. The first set of theories is given the name of structuralist theory of development which states that the poverty of the poor nations is attributed to structural problems of the UDCs. The other theory is given the name of 'International Dependencia model which states that it is the deliberate behavior on the part of DCs which exploited UDCs in such a way to keep them poor and backward. The third theory of economic development is called Stage Theory, where it has been told that the process of economic growth and development is furnished with certain stages (Rostow's stages of economic growth) whereby it has been emphasized that poverty comes into being due to shortage of capital, and growth can be attained by increasing the savings and investment (even through foreign resources). The fourth major theory of economic growth is given the name Neo-classical counter-revolution theory which says that rather blaming international forces the poor countries should depend upon free markets and privatization for their economic growth.

(5) Problems Of Population: The models of economic growth tell us that labor is an important factor of economic growth. But as far as developing countries are concerned it is not so. The population growth has led to create a lot of problems i.e., population in developing countries is rising faster than natural resources and the capital accumulation. Consequently, the developing countries have to face ever-rising unemployment. Moreover, the population growth often leads to migration of people from rural areas to urban areas. As a result, a lot of problems regarding urbanization and environmental pollution are rising. In such state of affairs, it is the Economic Development which deals with the issues of population growth, its effects on production, employment, migration, urbanization and environment etc. Again development economics presents different theories regarding population, i.e., what should be the optimum level of population for any country, Let quantity of labor which could have compatibility with the resources of the country.