RESOURCES. Resources A. Natural Resources B. Human Resources C. Infrastructure D. Technology.

RESOURCES

Resources

A. Natural Resources

B. Human Resources

C. Infrastructure

D. Technology

A. Natural Resources

Income from resource extraction can technically lead to higher GDP per hour…..

GNI per capita, Atlas method (current US$) 2012

Bermuda 104610

Norway 98880

Switzerland 80950

Qatar 78060

Luxembourg 71810

Macao SAR, China 64050

Denmark 59860

Australia 59790

Sweden 56120

Oil ReservesLink to BP Statistical Review of World Energy 2012

Resource Curse• Some scholars argue that countries “blessed” with

large endowment of mineral resources suffer slow growth.• Creates social conflict over control of natural resources.• Leads to unaccountable government.

• Ex 1. Conflict Diamonds Link

• Ex. 2 Nauru (pop. 8000) Link Significant deposits of phosphates and small population made this one of the wealthiest societies in world in 1970’s. But phosphates ran out.. – Country never developed internal sources

of productivity unemployment rate 90%– National gov’t corrupt and wasteful,

bankrupt and completely dependent on multinational aid

Is the resource curse true?

• Recent studies question these results, but findings suggest that positive productivity spillovers to non-resource industries are questionable. (Link Requires registration)

• Chad –Doba Basin

Chad and Resource Development

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

0

100

200

300

400

500

600

700

800

GDP per Capita US$ 2005

GDP per Capita (Non Resource) GDP per Capita

NFI Across Countries

NFI/GDP 2009UN Main AggregatesChad -42.68%Russian Federation -3.23%China: Hong Kong SAR3.12%Liberia -20.14%China, People's Republic of -2.04%Switzerland 4.15%Ireland -16.94%Brazil -2.04%Haiti 9.62%Cambodia -15.64%India -0.13%Bangladesh 11.00%Angola -13.95%United States 0.28%Philippines 14.73%Chile -9.69% Bermuda 23.62%Panama -8.97% Lesotho 35.17%China: Macao SAR-6.03%Australia -4.65%

Source: United Nations Main Aggregates Database

TROPICAL COUNTRIES AND DEVELOPMENTDavid Bloom and Jeffrey D.Sachs, 1999, “Geography, Demography, and Economic Growth in Africa,” Brookings Papers on Economic Activity Link

Tropics & GDP

Tropics and Development• Health risks worse in tropical areas.• Soil quality lower.• Agricultural technology does not translate from rich

temperate zones to tropics.• Relative lack of navigable rivers.

Malaria

Agriculture Productivity

Earth Institute Link

Scale Economies & Poverty Traps

LandProductivity

Scale

Subsistence

Development occurs through stages but African conditions prevent the most basic stage from generating enough returns to move to the next stage.

Millennium Villages• Millennium Project – Intensive intervention in health, education,

knowledge and infrastructure at the village level to get citizens out of the trap.

Link

Poverty Indicators DecreasingSub-saharan Africa

1990

[YR19

90]

1991

[YR19

91]

1992

[YR19

92]

1993

[YR19

93]

1994

[YR19

94]

1995

[YR19

95]

1996

[YR19

96]

1997

[YR19

97]

1998

[YR19

98]

1999

[YR19

99]

2000

[YR20

00]

2001

[YR20

01]

2002

[YR20

02]

2003

[YR20

03]

2004

[YR20

04]

2005

[YR20

05]

2006

[YR20

06]

2007

[YR20

07]

2008

[YR20

08]

2009

[YR20

09]

2010

[YR20

10]

2011

[YR20

11]

2012

[YR20

12]

0

10

20

30

40

50

60

70

80

Millenium Development Goals

Poverty gap at $1.25 a day (PPP) (%) Primary completion rate, total (% of relevant age group)

Growth Acceleration

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

120.00%

140.00%

160.00%

Agricultural Productivity in Africa

Relative to World Relative to SSA in 2000

B. Human Capital• Measures skill, education level of the work force.• General (broad primary & secondary education & health) or

specific skills (technical skills obtained at tertiary level).

By 2005, average in 25-29 cohort was 12.2 yrs compared with 13.4 years in USA

Average Years of Schooling

0

2

4

6

8

10

12

14

1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

Yea

rs

USA Singapore

http://www.barrolee.com/

Education• Literacy Rates: WDI• Years of Education Barro-Lee Dataset Link • Quality of Education: OECD Programme for International

Student Assessment (PISA) Summary Data Education Data

Aging Population Structure

0 - 4 9-May

14-Oct

15 - 19

20 - 24

25 - 29

30 - 34

35 - 39

40 - 44

45 - 49

50 - 54

55 - 59

60 - 64

65 - 69

70 - 74

75 - 79

80 - 84

85 - 89

90 - 94

95 - 99

100 +

0

2000000

4000000

6000000

8000000

10000000

12000000

Age Distribution Japan

2010

1990

1970

Peo

ple

Link Population by age, sex and urban/rural residence

Population Structure and Employment

1956

1958

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

46.00%

47.00%

48.00%

49.00%

50.00%

51.00%

52.00%

53.00%

54.00%

Japan: Employment to Population Ratio

The Classic Demographic TransitionModel

Stage 1 Stage 2 Stage 3 Stage 4

Time

Naturalincrease

Birth rate

Death rate

Note: Natural increase is produced from the excess of births over deaths.

Link

Stages of Demographic Transition

1. Low Population Growth. High Birth Rates, High Death Rates

2. Population Growth Explosion. Medical Advances slow mortality rates, high population growth.

3. Slowing Population Growth. Educational Advances slow birth rates.

4. Low Population Growth. Low Birth Rates, Low Death Rates

Japan

1950 1960 1980 2000 2005 2010 2015 2020 2040 2060 2080 21000

5

10

15

20

25

Final Stage of Demographic Transition

Birth Rates

Death Rates

per

100

0

World Population Prospects, the 2010 RevisionVolume II – Demographic Profiles Link

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2010

2015

2020

2025

2030

2035

2040

2045

2050

2055

2060

2065

2070

2075

2080

2085

2090

2095

2100

0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

Old-age dependency ratio (ratio of population aged 65+ per 100 population 20-64)

Eastern Asia China China, Hong Kong SAR Japan Republic of Korea

United Nations Data

Fertility Rates• Age-specific fertility rate: Number of Births to women of a

specific age per women/years of that age.• Total Fertility Rates: Sum of Age-specific fertility rates

from 15-49• Longer-term ratio of average number of children• Replacement Ratio:

• 2.1 Developed Economy, • 2.3 Globally

Country 15-19 20-24 25-29 30-34 35-39 40-44 45-49

Japan 1.27 5 36 82 86 38 5 0 1.26795

Total fertility

Age-specific fertility rates

United Nations Data

High Income OECD

C. Infrastructure

Air transport, freight

4000

5000

6000

7000

8000

9000

10000

11000

12000

13000

14000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

(mill

ion

to

n-k

m)

Singapore Hong Kong SAR, China

http://data.worldbank.org/data-catalog/world-development-indicators

Secure Internet servers

0

100

200

300

400

500

600

2003 2004 2005 2006 2007 2008 2009 2010

(per

1 m

illio

n p

eop

le)

Singapore Hong Kong SAR, China

http://data.worldbank.org/data-catalog/world-development-indicators

Link

D. Technology Capacity• Capacity for scientific advance measurable along a number of

dimensions. UNESCO Data

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 20100

0.5

1

1.5

2

2.5

3

Expenditure on R&D as % of GDP

Hong Kong Singapore

Link

Technical Workforce

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 20100

0.2

0.4

0.6

0.8

1

1.2

Technicians per 1000

Hong Kong Singapore

Link

http://www.uspto.gov/web/offices/ac/ido/oeip/taf/reports.htm

Utility Patents by Year

0

100

200

300

400

500

600

700

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

SINGAPORE CHINA,HONG KONG S.A.R.