Question

state two bases of measures of economic development

Answer 1

Two bases of measuring development of a country are :

 (i) Average or per capita income.

 (ii) National income and public facilities.


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Answer 2

answer 1- Economic development means that the rate of production must be faster than the rate of increase in population. In other words, it is a process which makes people in general, better off by increasing their command over goods and services and by increasing the choices open to them.
Two bases of measuring economic development of a country are -
National Income and Per Capita Income.

answer 2- 1. Physical Quality Of Life Index (PQLI):

In 1979, D. Morris constructed a composite Physical Quality of Life Index (PQLI). He found that most of the indicators were inputs to development process rather than result of the development process. These indicators reflected that economically less developed countries are simply underdeveloped versions of industrialized countries. He therefore, combines three component indicators of Infant Mortality, Life Expectancy and Basic Literacy to measure performance in meeting the basic needs of the people.

However, the choice of indicators are:

1. Life Expectancy Indicator (LEI)

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2. Infant Mortality Indicator (IMI)

3. Basic Literacy Indicator (BLI)

These three indicators can be improved in a variety of ways. However, Prof. Morris used Life Expectancy (LE) at birth as the indicator. Infant mortality implies deaths before age one instead of life expectancy at birth. In case, the figure for life expectancy at age one was not available, it could be worked out by using a formula which relates life expectancy at birth, infant mortality and the proportion of children.

How to Normalize Indicators:

We are familiar that life expectancy is measured in terms of years, infant mortality rate in terms of per thousand and basic literacy rate in terms of percentage. They cannot be simply added. Moreover, basic literacy can have a natural zero for minimum and 100 for maximum, thus there exists no natural minimum or maximum values for other indicators. For comparison, each of the levels should be normalized. Prof. Morris chooses the best and worst levels in each of the three cases.

In the case of positive indicators of life expectancy and basic literacy, the best is shown by the maximum and worst by the minimum. While in case of a negative indicator of infant mortality, the best is denoted by the minimum and the worst by the maximum. For converting the actual levels of a positive variable into normalized indicators, first the minimum values are subtracted from the actual values and then the gap is divided by the range.