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Trade in the Contemporary World

Trade, export value and human development

  • 3 things to know
  • Component 02

Overview

Recall questions on the Human Development Index and its dimensions, the link between export value and human development, why export earnings may not raise development, as in Equatorial Guinea, commodity dependence, the Prebisch–Singer hypothesis, and trade openness with a worked calculation.

What you need to know

Answer each one before you reveal it.

Your recallNot started
Key term

What does the Human Development Index measure?

Key term

State the range of possible Human Development Index values.

Key term

Name the three dimensions combined in the Human Development Index.

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    What does the Human Development Index measure?

    Model answer

    The Human Development Index is a composite measure of average achievement in health, education and income, used to compare development between countries.

  2. 2

    State the range of possible Human Development Index values.

    Model answer

    Values run from 0 to 1, with higher values indicating higher human development.

  3. 3

    Name the three dimensions combined in the Human Development Index.

    Model answer

    Health measured by life expectancy at birth, education measured by years of schooling, and standard of living measured by gross national income per person.

  4. 4

    Describe the general relationship between the value of a country's exports and its Human Development Index.

    Model answer

    Countries with high export earnings per head generally record high human development, because export income supports wages, tax revenue, health care and schooling, although the relationship is far from perfect.

  5. 5

    Why is the value of exports a more useful indicator than the volume of exports?

    Model answer

    Value captures how much a country actually earns, so a country shipping a small tonnage of high-value manufactures scores higher than one shipping huge tonnages of cheap raw materials.

  6. 6

    Explain why high export earnings do not always produce high human development.

    Model answer

    Earnings can be concentrated in a single enclave industry and captured by foreign firms or a narrow elite, so very little of the income reaches ordinary people as jobs, services or wages.

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AThe lower quartile is the 2nd value, 11 cm.
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