Economic Development - Video Review

Michael Daubert

Economic Development

Professor Mirmirani

Video Assignment #2

Part 1:

The second video we watched highlighted three very significant points. The first point was called access to growth and it discussed how 8-9 million people are starving and 1 billion people are earning less than $1 a day. This is simply because poor people do not have access to the necessary resource they need in their everyday lives. As a result, the IFAD’s job is to examine poverty and try to reduce royal poverty by increasing food output and hopefully this will help small farmers increase their wealth. However, economic growth does not matter to poor people because they have no access to the economy. In addition, the video believes we need to define development from a bottom up perspective, which means starting at the poor. Private initiative is the core of the private sector of the economy and a lot of what we consume comes from third world countries. We need to help these populations and find a way to get these goods for cheaper and the people in poor countries need to see the benefit of the help that they are given. In addition, the video empathizes that economic growth needs to be fair and just because nowadays more people only have access to food and we are still far away from a break through due to population growth.

The second significant point that the video discussed was called political and economic stability and it involved Singapore wanting to become a world trading center. However, this involves getting entrepreneurs to do business in Singapore; a place in which standard living is the highest in the region. They are also looking for industries that challenge young people. The video also highlights how TRUMPF has cheap skill workers, sufficient infrastructures, and a great connection to the area, no corruption, and process & logistics are very simple. This is simply because they are highly interested in getting international business as well as investors. In addition, they are fluent in English and have political stability. Their consistent policies are guaranteed, which is very important for companies because there are a ton of laws and penalties. In addition, they have great educational systems as well as subsidized housing.

The third significant point in the video was called investing into human capital and it also discussed Singapore. The video talked about how people need to invest in human capital and how there should be no national wealth. They clearly believed that the only capital for Singapore is human capital. In addition, the video highlights how there needs to be a development of the mind, which is why educational systems are the backbone. Therefore, they cannot compete on cost alone but can compete on brain power. Their educational systems are based around an IT culture and there is a PC for every two children in elementary schools. They also believed there needed to be a change in the curriculum and they made it less content and more critical thinking. They also empathizes on how human capital of the future belongs to the knowledge of workers, which means they must be able to take in information and process it. As a final point, I found it very interesting that the teacher admits that a lot of the students know more than they do.

Part 2:

        The first significant point, access to growth, relates to the country I am studying because there has been several instances where poverty has affected Turkey. A good example of this took place in Erzurum, Turkey during 2005 and the Turkish government “helped tens of thousands of mothers cover (the) essential child-rearing expense under the Social Risk Mitigation Project, financed by a World Bank loan”(The World Bank). They give out Conditional Cash Transfers to the poorest 6% of households and this had helped 1.9 million of the poorest children in Turkey. This is just like the IFAD because they are both also attempting to tackle the issue of poverty and improve living standards for their people. In addition, both Turkey’s government and the IFAD are tackling the problem from a bottom up perspective and they are assisting the poorest people first. However, it is reported that “GDP growth dropped to 4.4% in 2013 and 2.9% in 2014 due to the lackluster consumer demand both domestically and in Europe.” In addition “high interest rates have also contributed to the slowdown in growth”, which has cost them to cut rates in February 2015 in an attempt to create economic growth. (CIA World FactBook).