Economic Indicators Developed Countries Underdeveloped Countries and Globalization

Economic Indicators: Developed Countries, Underdeveloped Countries, and Globalization A presentation to the hiring team at College of Marin, April 2019 by Laurie Hailer-O’Keefe www. quantgal. com

Learning Outcomes: ▪ Review traditional measures of economic strength of a nation ▪ Determine other measures of a country’s wellbeing (SPI, HDI, BLI) ▪ Understand explain how globalization benefits developed countries and underdeveloped countries ▪ Understand explain how globalization may be harmful to underdeveloped countries

The Phillips Curve 1 The Federal Reserve Bank currently operates with a dual mandate to keep unemployment and inflation in check. Do you know what their current targets are?

Gross Domestic Product (GDP) and Social Progress (SPI)2

Take a moment… ▪ What are the traditional economic indicators? ▪ Brainstorm: other indicators for national well-being ▪ Jot some notes on your note sheet, if desired.

Activity! (You are all in Group B!) Group A • Go to the OECD website http: //www. oecdbetterlifeindex. org/ • Create a Better Life Index Group B • Review the HDI Handout • Where would you move? Why? Group C • Go to the Social Progress website • Find the World Map of results • What is social progress? ▪ For today: ▪ Review the indicators for countries A-T. ▪ Identify a few that you would identify as developed nations. ▪ Identify a few that you would argue are underdeveloped. ▪ Discuss your rationale with your group. ▪ For a class: Choose where you would most/least want to move.

How do you know whether a country is developed or underdeveloped? Developed countries 3 Underdeveloped Countries 8 Industrialized or developed nations are specific countries with a high level of economic development and meet certain socioeconomic criteria based on economic theory, such as gross domestic product (GDP), industrialization and human development index (HDI) as defined by the International Monetary Fund(IMF), the United Nations (UN) and the World Trade Organization (WTO). Using these definitions, some industrialized countries are: United Kingdom, Belgium, Denmark, Finland, France, Germany, Japan, Luxembourg, Norway, Sweden, Switzerland the United States. An underdeveloped country is defined as a nation that is not as developed economically as other nations. These countries are very poor, have very low per capita real income, poverty is widespread, and many residents live in very dire conditions. In these nations, very little money is spent on health care or education, and there is very little industrial activity when compared to more developed nations. The main occupation in most underdeveloped nations is agriculture. Examples are: Uganda, Sudan, Yemen, Haiti, Nepal, Afghanistan, Madagascar, Bangladesh, Ethiopia, Liberia, Guinea, Rwanda and Sierra Leone.

Human Development Index 4 More information on the HDI can be found through the United Nations Development Programme site found here: http: //hdr. undp. org/en/content/human-developmentindex-hdi

UNDP Country Information: http: //hdr. undp. org/en/countries

Impacts of Globalization Who is impacted positively? What are some drawbacks? ▪ Developed countries benefit from more choices for consumption at lower prices, which may increase profits for corporations. ▪ Skilled workers may lose jobs, contributing to a widening gap between rich and poor in developed nations. ▪ Underdeveloped countries benefit from having more jobs and may benefit from trade. ▪ Workers in underdeveloped nations may not benefit as much as expected and may even be exploited.

The disappearing middle: automation and globalization 7

Manufacturing in the US ▪ Workers have been displaced by globalization and automation ▪ Automation has occurred in rust belt states where machines are replacing workers in manufacturing sector jobs involving autos and steel. These tended to be highly skilled jobs and paid well. ▪ Other manufacturing have moved outside the US (globalization) to where labor and resources are cheaper, such as the garment industry.

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Resources/Footnotes: 1. 2. 3. 4. 5. 6. 7. 8. https: //www. socialprogress. org/index/global/results Mankiw, Principles of Economics, 8 th Edition. United States, Cengage, 2017, Instructor resources. Investopedia: https: //www. investopedia. com/articles/economics/10/globalizationdeveloped-countries. asp United Nations Development Program: http: //hdr. undp. org/en/content/humandevelopment-index-hdi OECD: https: //www. oecd. org/unitedstates/Middle-class-2019 -United-States. pdf http: //worldpopulationreview. com/countries/underdeveloped-countries/ OECD (2016), Back to Work: United States: Improving the Re-employment Prospects of Displaced Workers, Back to Work, OECD Publishing, Paris, https: //doi. org/10. 1787/9789264266513 -en. https: //www. un. org/en/development/desa/policy/wesp_current/2014 wesp_coun try_classification. pdf