Economic growth & development: แบบฝึกหัด

Country Alpha has recorded a consistent annual growth rate of \( 8\% \) in real GDP per capita over the last decade. However, during the same period, its Human Development Index (HDI) has remained almost stagnant. Which of the following most likely explains this phenomenon?

(1) The growth was primarily driven by the export of natural resources, with the revenues concentrated among a small elite group.
(2) The rapid industrialization process led to severe urban smog and water contamination, causing a decrease in the average life expectancy.
(3) The government significantly increased the proportion of the budget allocated to vocational training and adult literacy programs.
(4) The country’s population growth rate exceeded its real GDP growth rate.

Explain how an increase in the dependency ratio due to an aging population can hinder a country's long-term economic growth by reducing its saving rate and investment.

Beyond simply increasing real GDP per capita, explain two distinct dimensions included in the Human Development Index (HDI) that provide a broader understanding of a nation's economic development.

A developing nation chooses rapid industrialisation driven by intensive resource extraction and minimal environmental regulation, coupled with weak enforcement of private property rights over those resources. Explain, in terms of economic incentives and future capital stock, why this strategy creates a severe long-term constraint on sustainable economic development.

A country is evaluating its progress over the last decade. While its real GDP per capita has increased by 15%, the government is concerned about other aspects of economic development and its long-term growth trajectory.

(a) Identify the three dimensions of the Human Development Index (HDI) and explain why a rise in real GDP per capita does not necessarily result in a higher HDI score for a nation. (3 points)

(b) Explain how the strengthening of property rights and investment in human capital contribute to a country's long-term economic growth. (2 points)

Country B is a developing economy aiming for robust and inclusive economic growth.

(a) Discuss how the strengthening of property rights and the fostering of technological change are crucial for accelerating long-term economic growth in Country B.

(b) Explain the potential impact of rapid economic growth on income distribution within Country B. Suggest one government policy that could mitigate any adverse effects on income distribution while still promoting growth.