Lecture topic
What is Development?
– the Multiple Facets and Changing Paradigms
PRMX Course
Measuring Development
(Module: Development Perspectives)
Hippu Salk Kristle Nathan
Institute of Rural Management Anand
Dt. 15 October, 2019
What is development?
• Growth rate; Rise in personal income
• Industrialization; Technological advance
• Access to services; satisfaction of basic needs
• Social modernization
• Freedom; Capabilities
Sen’s capability approach
• Satisfaction/happiness
Bhutan’s GNH
What is development?
Cont...
Daly’s Continuum
It relates natural wealth
to ultimate human
purpose through
‘technology’, ‘economics’,
‘politics’ and ‘ethics’, by
integrating means and
ends
Dally (1973); Meadows (1998)
What is development?
Cont...
Bhutan’s GNH
(CBS, 2012)
Sen’s flute example
• Child A: the only one of the three that knows how to play it.
• Child B: is poor and has no other toy of his own to play with.
• Child C: has been working on the flute for months, so deserve it
Who should get the flute?
and Why???
(Sen, 2006)
real-life decisions
Going back to Sen’s flute example
Changing the flute to scholarship on an infectious disease
Changing the flute to fruit/food
Changing the flute to party ticket in a safe constituency
(Mishra, 2006)
Limitations of monetary measure
Shortcomings of GDP
Treats ‘goods’ and ‘bads’ as same:
Considers only economic value (not social value, not environmental
consequences)
Tobacco and health care – treated same
Power plant – do not take into account environmental consequences
Not account the damage to the assets resulting from pollution
Increases with polluting activities and again cleanups
(pollution: double benefit to the economy)
Crime, divorce, and natural disasters as economic gain
Examples: transportation sector
Limitations of monetary measure
Cont...
Shortcomings of GDP
Depletion of natural capital as income
Example – Income for extracting minerals recorded, but simultaneous
depletion is not.
Misleading signal on sustainable national income
– growth is through liquidation of natural capital:
short run ~ long run
For a natural resource dependent economies, GDP and saving are
overstated.
Limitations of monetary measure
Cont...
Shortcomings of GDP
Ignore non-market activities
Childcare, elder care, other home-based tasks, and volunteer
work in the community go completely non-reckoned
Harvest of firewood or wild foods for own use.
Non-marketed goods provided by ecology – not accounted
(Example: recreation value of forests, forest provides watershed
protection – benefiting agriculture, hydro power, municipal water
system)
Several features which cannot be monetized – beauty of a village.
Limitations of monetary measure
Cont...
Shortcomings of GDP
No account of income distribution:
Average; total
No account of quality of products:
Same economic value – quality of products may change
No account of quality of life:
Leisure
Capabilities
Challenging fundamental notion of GDP
HD; Degrowth
Limitations of monetary measure
Cont...
Challenging fundamental notion of GDP
Human development
Sustainable development
Degrowth
- “the only sustainable growth is degrowth”
- rebound effect
(SCORAI, 2016)
Human development paradigm
Sen’s capability approach
Importance of ‘ends’
related example: Dally’s continuum (Dally, 1973)
Pluralistic understanding of well-being (Sen, 1987)
Another belief which harmonizes with our account is that the happy man
lives well and does well; for we have practically defined happiness as a
sort of good life and good action.
(Aristotle, 350 BC)
“Capabilities are the abilities to do certain things or to achieve desired
states of being. They are empowerment, the power to obtain what you
desire, utilize what you obtain in the way that you desire, and be who you
want to be. Goods, on the other hand, are merely things that you
possess.”
(Stanton, 2007)
Ends and means of development
• Traditional way of looking at development
• HRD
• Human welfare – only beneficiaries
Human development paradigm and
Sen’s capability approach
Ends and means of development
Cont...
• Capabilities and choices
• Development is a process of expanding freedoms (Sen, 1999)
resources capacity actions utility
• Market – only one mechanism
• Income – only one dimension (rich also can be deprived)
Example: income versus energy resource (Halff et al., 2014)
Human development paradigm
Cont…
The Humanist Revolution (Stanton, 2007)
Rawls theory of justice (Rawls, 1971)
social primary goods
“Original position” under veil of ignorance
(No knowledge of future; History has no influence)
Two principles
1. Equal basic liberties
Each person has the same indefeasible claim to a fully adequate
scheme of equal basic liberties, which is compatible to all
2. Social and economic inequalities must satisfy two conditions
First, positions open to all under conditions of fair equality of opportunity
Second, they are to be the greatest benefit of least advantage
member of the society: difference principle (maximin rule)
HDI was born of the humanist revolution.
Thank You
Queries and Suggestions
E-mails:
happyhippu@gmail.com,
hippu@irma.ac.in
