From the Local to the Global, Third Edition: Key Issues in Development Studies / Edition 3

by Gerard McCann, Stephen McCloskey

Overview

In recent years, the international development sector has found itself confronting new and persistent challenges to poverty eradication and the promotion of human rights. From The Local to the Global highlights the extent to which the local and global are interconnected in today’s world economy and questions the legitimacy of the neo-liberal model of development that they argue has propelled us into the crisis.
            This completely revised third edition takes stock of the international development environment as it embarks on new policy frameworks to confront new challenges, ensuring that From the Local to the Global will continue to serve as an indispensable introduction to key development issues such as aid, debt, trade, migration, security, gender, and climate change.

Product Details

ISBN-13:	9780745334738
Publisher:	Pluto Press
Publication date:	06/15/2015
Edition description:	Third Edition
Pages:	280
Product dimensions:	5.30(w) x 8.40(h) x 1.00(d)

About the Author

Gerard McCann is a senior lecturer in international studies at St Mary’s University College, Queen’s University, Belfast and director of the Global Dimension in Education project.


Stephen McCloskey is the director of the Centre for Global Education, Belfast, and editor of the journal Policy and Practice: A Development Education Review. His publications include Development Education in Policy and Practice and The East Timor Question: The Struggle for Independence from Indonesia.

Read an Excerpt

CHAPTER 1

Measuring Human Development

Andy Storey

We need to construct a vision that is different from the Western capitalist development model. We must move from the sustainable development paradigm to the Bien Vivir comprehensive development approach that seeks not only a balance among human beings, but also a balance and harmony with our Mother Earth. No development model can be sustainable if production destroys Mother Earth as a source of life and our own existence. No economy can be long lasting if it generates inequalities and exclusions. No progress is just and desirable if the well-being of some is at the expense of the exploitation and impoverishment of others.

(Bolivian President Evo Morales, 2014)

Measuring development presupposes being able to define what development actually is. Evo Morales offers his own definition in the above passage, and it immediately leads us to think about the link between definition and measurement. How, for example, would we measure whether someone was in balance and harmony with the earth, or whether that person was not exploiting others? This issue of definition is first addressed in this chapter before moving on to an examination of the most commonly used measures of economic development – notably gross domestic product (GDP) and gross national product/income (GNP/I). These remain the standard international measures of development, but they provide us with only a very limited, and in some ways positively misleading, understanding concerning the quality of people's lives and the welfare of the planet.

As a method of measuring development the best known alternative to the purely economic indices is the Human Development Index (HDI), which relies upon multiple (not solely economic) criteria, and which was partly inspired by the work of the Indian economist and philosopher Amartya Sen. The HDI, along with a number of other indices that have been constructed in recent years, including those that try to incorporate questions of environmental sustainability, is discussed here. For some, however, the struggle to come up with ever more sophisticated and comprehensive measures of development is fundamentally wrongheaded. The work of 'post-development' writers insists that all attempts at such measurement contribute to Western domination of the so-called 'Third World': this critique will be reviewed. However, the attractions of quantifiable measurement remain strong, and it partially underpinned the emergence of the Millennium Development Goals (MDGs) as a recent means of measuring development progress. Consequently, there have been problems with the MDGs, as there will be with their putative successors, the Sustainable Development Goals (SDGs).

Defining Development

Measures of development are inextricably linked to definitions of development, pointing to the need for a better understanding of what development is before seeking to measure it. For many years this understanding seemed fairly straightforward. For most economists and policy analysts, development was seen as equivalent to economic growth, of which growth in GNP/I – discussed in detail below – served as the main indicator. This is usually expressed in 'per capita' (per person) terms: that is, the gross, or total, national product/income is divided by a country's population to give an average figure which represents a country's level of economic development. Comparing GNP per capita from year to year provides a measure of economic growth relative to population size, and this is commonly taken as a measure of development progress, or the lack of it.

For many years also, development was officially seen not only as growth in the economy, but also as a transformation or shift of the economic structure away from primary goods production (of agriculture and raw materials) towards manufacturing and service activities. This was most famously articulated by the prominent US social scientist (and senior US government advisor) Walt Rostow in 1960 in The Stages of Economic Growth, in which he developed the notion of 'stages of growth' through which all societies proceed. Rostow's stages were:

1 Traditional society.

2 Preconditions for take-off.

3 Take-off.

4 Drive to maturity.

5 Age of high mass consumption.

Rostow saw the world in quite crude, linear terms – poor societies become 'modernised' (both economically and socially) and essentially end up resembling the United States.

This approach came under increasing criticism, particularly in the 1960s and 1970s. The notion of 'growth without development' became common with reference to countries such as Brazil, where impressive GNP per capita growth – and indeed a degree of Rostow-style structural transformation – seemed to coexist with growing inequality and poverty for many. As one Brazilian politician is said to have remarked, 'Brazil is doing well but its people are not.' For the British economist Dudley Seers, alternative definitions of development were required:

The questions to ask about a country's development are therefore: What has been happening to poverty? What has been happening to unemployment? What has been happening to inequality? If all three of these have declined from high levels then beyond doubt this has been a period of development for the country concerned. If one or two of these central problems have been growing worse, especially if all three have, it would be strange to call the result 'development' even if per capita income doubled.

(Seers, in Todaro, 2000: 15)

The development criteria suggested by Seers can be discerned, at least in part, in the later method of measurement introduced by the UN Development Programme (UNDP) in the form of the HDI. As will be discussed further below, an even more important influence on the HDI was the work of Amartya Sen. The HDI encapsulates a concept of development as a process of enlarging people's choices – allowing them the opportunity to live longer, to acquire knowledge, and to generally live fulfilling lives according to their own criteria and priorities. Thus, the narrow focus on economic growth and transformation is widened to embrace a variety of other (economic, but also non-economic) factors.

The 1980s saw a further crucial variable thrown into this definitional pot, that of environmental sustainability. In its most famous articulation, from the 1987 report Our Common Future (also known as the Brundtland Report) produced by the UN World Commission on Environment and Development: 'Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs' (quoted in Martinussen, 1997: 150). The central challenge here is that unlimited economic development is unsustainable within the constraints of a finite ecosystem, a subject that is discussed further below.

Beyond the standard measurement systems which are utilised by international agencies, there are many more contested definitional issues. Some writers, for example, see societies that have developed materially but have lost touch with traditional – itself a contested concept – spiritual or cultural values, as having 'maldeveloped' (see the European Journal of Development Research, 1996). Others see the absence of political freedom and democracy as invalidating any claim to development regardless of levels of economic growth (sustainable or not) and the improvement of social indicators (www.freedomhouse.org). The persistence of war and armed oppression is viewed by many as antithetical to any meaningful conception of development. And a growing number of writers and activists identify development as being about the progressive realisation of human rights – what is known as the rights-based approach to development (Uvin, 2004).

Despite these definitional disagreements, there is a strong desire on the part of many interested parties to know whether development, however defined, is occurring or not – in other words, there is a desire to measure development despite its evident complexity. It is to some of these attempts at measurement that we now turn.

Standard Economic Development Measures

A basic measure of economic activity is GDP, the total output of goods and services in an economy measured at market prices. This measurement should only include the final output produced and not intermediate production. For example, if a factory produces screws that subsequently contribute to the value of a car also produced in the same country, then only the final value of the car should be included in GDP – to count the value of the screws separately would be to double-count. GDP essentially measures the total value of production taking place in an economy. However, it does not measure the extent to which resources are available in that economy, in that not all the value of what is produced is necessarily available to the residents of that country. GDP was the subject of a coruscating critique in Gross Domestic Problem: The Politics Behind the World's Most Powerful Number by Lorenzo Fioramonti (2013), one of whose arguments is that the word 'domestic' is misleading. Income accruing to foreign investors is treated as if it were a measure of the success of the country in which the production takes place.

In order to deal in part with that criticism, and capture the actual level of resource availability, it is necessary to adapt GDP. One way to do this is to engage in a process of addition and subtraction. We could subtract from GDP certain outflows of resources. Some of these resources are related to capital – chiefly, profits remitted out of an economy by companies (often, though not necessarily, foreign ones) operating in that economy. Other resource outflows are related to labour – such as the share of wage income remitted home by migrant workers resident in that economy. Because capital and labour are conventionally described as the 'factors of production', such outflows are referred to as 'factor outflows'. Conversely, we could add to GDP certain inflows of resources. These include capital-related flows, such as the profits remitted into an economy from a company operating externally – for example, in the case of the United States, the profits sent back to that country from a US multinational company's operations in, say, Nigeria or Colombia. There will also be labour-related inflows, such as the portions of wages sent home to India or Turkey by workers from those countries labouring in the Gulf States or in Europe. Taken together, these are factor inflows.

For any given economy, there will be both factor outflows and factor inflows. Balancing out these different flows will yield what is called 'net factor income' – which can be either positive or negative. GDP plus or minus net factor income generates GNP, the most commonly used measure of economic development, especially when expressed relative to population size (that is, per capita). Some commentators prefer to use the term GNI, as it is more of a measure of income than it is of product. There may be a substantial discrepancy between GDP and GNP/I, such as in a country like Ireland where multinational companies siphon substantial profits out so that GDP is substantially higher than GNP/I (Fitzgerald, 2013).

The main argument in favour of using GNP/I per capita as a measure of development is that unless there is an increase in the availability of goods and services, development is unlikely to be occurring – that is, a rising GNP/I per capita is, at least, a precondition for development. Moreover, the method of calculating GNP/I is relatively well understood and reasonably widely recognised – most people know what is being measured and how. Also, all countries produce GNP/I estimates, so international comparison is facilitated.

But the arguments against using GNP/I as a measure of development are significant. First, and fundamentally, GNP/I is an economic measurement, and by definition does not take account of noneconomic criteria. If, as discussed above, our definition of development incorporates social, cultural or political considerations, then any solely economic measurement is obviously unsatisfactory.

Second, GNP/I, when expressed in per capita terms, takes no account of how resources are distributed. GNP/I per capita is a statistical average which bears no necessary relationship to the actual resources available to any person in a country. A society with a highly unequal distribution of resources could have a high GNP/I per capita, while the majority of its population lived in extreme poverty or even destitution, as is the case in many countries – and increasingly so as income and wealth inequalities have widened substantially in recent years (Piketty, 2014).

Third, GNP/I (as with GDP) is based on market prices. Non-market transactions are not covered. A variety of economic activities, especially in poorer economies, may not be included in GNP/I calculations. These typically include the cultivation of food for domestic consumption; the processing and cooking of that food; the maintenance and repair of domestic equipment and clothing; the provision of household fuel and water; caring for children, the elderly and the sick; and participation in (unpaid) community activities. A common thread unites these disparate activities: they are usually performed by women. Thus, GDP and GNP/I are gender-biased indicators of development (Beneria, 1995). But it is not only women's work that that may be undervalued or excluded from GDP and GNP/I. Activities taking place in the so-called 'informal' economy perhaps involving barter or otherwise not passing through official market channels – are also usually underestimated or completely ignored by the standard measures of economic development. And how do we deal with a phenomenon such as Twitter, whose 230 million users pay nothing for the service but who have turned the company into one worth $24 billion (Naughton, 2013)?

Fourth, market prices – the foundation stones of GDP and GNP/I may not reflect the real social value or cost of producing an economic resource. In recent years many economies grew rapidly on the basis of financial speculation (Lapavitsas, 2013), but can this be said to have really contributed to human development? Jones (2011: 159), drawing on the work of the New Economics Foundation (NEF), documents how for every $1 paid to a city banker, $7 of social value is actually destroyed; whereas a dollar paid to a hospital cleaner reflects only a fraction of the social value they generate (through improved health outcomes). Likewise, the production of missile systems to replace those fired in a war is counted as a positive in the conventional measures, but might this not constitute a negative in terms of real human well-being?

Measuring Environmental Destruction

Related to this fourth point, it is in the area of the environment that some of the problems with conventional economic measurement of development are most starkly revealed (Daly, 1997: 121-5; Kovel, 2007). Here especially there is no guarantee that the economic activity comprising GDP or GNP/I is really a positive contribution to society at all. If a production activity involves serious environmental depletion and damage, then it might be more accurately considered a negative when measuring society's development, whereas the GDP or GNP/I measure will automatically regard the marketed output as a boost to development. This point is underlined in the extreme example of a country that cuts down all its trees, sells them for wood and then gambles the proceeds: GNP/I per capita would register a significant increase, whereas real societal development would clearly have been seriously damaged.

At a global, environmental level, the consequences of fetishising economic growth are stark. Were every country in the world to reach a per capita GDP level of $13,000 (which is what the World Bank classifies as the threshold to be considered a high-income country) then global GDP would need to rise from the present $72 trillion to $91 trillion; but our planet can probably sustain a GDP of only $48-50 billion (Hamid and Duraiappah, 2014). To live sustainably we need instead to focus on 'de-growth', which calls for a radical paradigm shift in which development might be measured not by how much the economy is growing but rather by how much it is shrinking (Fioramonti, 2013).

Edward Goldsmith has observed that 'GDP growth is the rate at which the powerful are expropriating the resources of the weak to create garbage', with the added element that they may also be producing, through climate change, the erosion or elimination of the ecosystem itself (quoted in Starr, 2000: 1). Brand and Wissen (2012) also emphasise the clash between the strong and the weak in their evocation of what they term the 'imperial mode of living', through which the everyday production, consumption and lifestyle (such as commuting) practices of people in rich countries impose enormous costs on people in poor countries – rising sea levels, increased incidences of natural disaster through climate change, the dumping of waste, the violence and pollution that is often part and parcel of fossil fuel extraction, and so on. Thus, what is measured as development (economic growth) in some countries comes at the cost of not only planetary destruction but also the exploitation of others.

(Continues…)

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Table of Contents

Acknowledgements
List of Abbreviations

PART 1 DEVELOPMENT DISCOURSE AND DEFINITIONS
1. Introduction – Creating New Paradigms for Development - Stephen McCloskey
2. Measuring Human Development - Andy Storey
3. A Human Rights-Based Approach to Development - Paul Hainsworth and Máire Braniff

PART II THE ECONOMICS OF DEVELOPMENT
4. Overseas Development Aid: Is it Working? - Patrick Marren
5. Trade, Development and Inequality - Denis O’Hearn
6. Debt Injustice in the Global North and South - Nessa Ni Chasaide

PART III DEVELOPMENT POLICY
7. Climate Change and Development - David Selby
8. Europe. Development and the Colonial Legacy - Gerard McCann
9. Post-2015 Development Assessment: Proposed Goals and Indicators - Walden Bello
10. Women Contributing to Gender-Just, Equitable and Sustainable Development - Patricia Muñoz-Cabrera
11. The Complexity of Migration - Michal Cenker

PART IV REGIONAL DEVELOPMENT
12. Rethinking Latin America: Back to the Future? - Ronaldo Munck
13. The Arab Spring: Trading Development for Stability - Heba Khalil
14. China: The New Face of Development - Russell Duncan
15. Meaningful Development Goals and Sub-Saharan Africa - Chrispin R. Matenga

PART V HUMAN DEVELOPMENT
16. Children, Childhood and Work: Perceptions and Practices - Madeleine Leonard
17. Development Education as an Agent of Social Change - Stephen McCloskey
18. Neoliberal Decline and International Development Post-2015 - Gerard McCann
Notes on Contributors
Index

Editorial Reviews

"The book is a student-friendly and wide-ranging overview to the main debates and ideas associated with development. I can easily imagine using the book in class to help students work through the concepts they need in order to grasp the sources of poverty and unfairness in the world." —Ian Taylor, Department of Political and Administrative Studies, University of Botswana

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