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CBSE · Class 10 · Understanding Economic Development

Chapter 1: Development

6 concepts · 48 practice questions with answers · Free to read

This lesson is also in: मराठी · हिंदी

Different people, different goals

From daily life

A new highway is planned near your town. The truck owner is delighted, the farmer whose field will be cut in two is worried, and the tea-stall owner hopes for more customers. One road, three different dreams.

Simple definition

Development means improving life in the way people themselves hope for. Because people's life situations differ, their developmental goals differ and may even conflict. People seek more income, but also security, respect, freedom and equal treatment.

Landless labourer: fair wages, more workIndustrialist: cheap power from a big damDisplaced villager: keep home and landA girl: equal freedom to choose

In the figure : Each person sees development differently, and some goals clash.

Rule 1: Goals differ, and sometimes they clash — What helps one group may harm another, so no single idea of development suits everyone.

  • Easy : A farmer wants a high price for onions; the city buyer wants them cheap.
  • Medium : A factory owner wants a big dam for cheap power; villagers whose homes would go under water prefer small check dams.
  • Exam-type : 'Different goals' and 'conflicting goals' are not the same. Two people may want different things without any clash; a clash means one goal harms the other.

Rule 2: Income matters, but it is not the only goal — Besides money, people value things that are hard to measure: job security, dignity, freedom, equal treatment and a safe environment. What cannot be measured is not unimportant.

  • Easy : Friendship cannot be bought, yet it matters a great deal in life.
  • Medium : A job with slightly lower pay but a regular, secure income may be preferred to a high-paying job with no security and no time for family.
  • Exam-type : When women are respected, housework is shared and more women take up jobs; a non-income goal can raise income as well.
Remember

Development means different things to different people. Always ask: whose goal, and does it harm someone else?

Common mistake

Thinking that development means only more money. Security, respect and equality are goals too.

Shortcut

Memory clue: I-S-R-E — Income, Security, Respect, Equality: the four things most people seek.

Spot the difference

PointDifferent goalsConflicting goals
MeaningWants are not the sameOne want harms another
ExampleA girl wants to study abroad; a boy wants a sports careerA girl wants equal freedom; her brother dislikes sharing housework
ResultBoth can be satisfied togetherA fair way must be found

Practice questions

Easy
  1. 1Name two non-income goals people have.
  2. 2Give one example of two people wanting different things in development.
  3. 3Is development the same for everyone? Say yes or no.
Medium
  1. 4A dam gives power to a factory but floods a village. Whose goals clash?
  2. 5Why may a person accept a lower-paid secure job over a high-paid insecure one?
  3. 6How is 'different goals' unlike 'conflicting goals'?
Challenging
  1. 7Explain with an example how a non-income goal can also help income.
  2. 8Why do life situations of people matter more than their personalities in shaping goals? Give a reason.
Show answers (try them yourself first)
  1. 1Any two: security, respect, freedom, equal treatment.
  2. 2A farmer wants a high price for onions; a city buyer wants a low price.
  3. 3No. Different people have different, and even conflicting, goals.
  4. 4The industrialist (power) and the displaced villagers (home and land).
  5. 5Security, regular income and time for the family also matter, not just the pay.
  6. 6Different goals can exist side by side; conflicting goals harm each other.
  7. 7Respect for women leads to more women working outside, which raises family income.
  8. 8People in different life situations (landless or landowner, rich or poor, urban or rural) need different things, so their goals differ.

Income, averages and comparing countries

From daily life

Two classes took the same test. Class A scored 400 marks in total and Class B scored 450. Is B better? Not if B has 45 students and A has only 40. Comparing the average mark per student is fairer.

Simple definition

To compare countries, economists use per capita income (also called average income): the total income of a country divided by its population. The World Bank groups countries by it into high-income (rich) and low-income countries. India is a low middle income country. But an average can hide who earns how much.

Monthly income of 5 people in each country (thousand)20120220320420521222324925Country ACountry B

In the figure : Both countries have the same average income of 20 thousand, but one has equal incomes and the other has one rich person.

Rule 1: Per capita income = total income ÷ population — Total income alone is not useful, because countries have different populations. Dividing by the number of people tells what an average person earns.

  • Easy : A village with a total income of Rs 6,00,000 and 30 people has Rs 20,000 per person.
  • Medium : Village X: total income Rs 9,00,000 and 30 people. Village Y: Rs 12,00,000 and 60 people. X has Rs 30,000 per person and Y has Rs 20,000, so X is ahead although Y has more total income.
  • Exam-type : If the average income of four families is 5,000 and three families earn 4,000, 6,000 and 5,000, the fourth earns 20,000 − 15,000 = 5,000.

Rule 2: An average does not show how income is shared — Two countries can have the same average but very different sharing of income. The country with more equal incomes is generally preferred, so besides the size of income its distribution matters too.

  • Easy : Five people earn 20, 20, 20, 20, 20. Another five earn 2, 2, 2, 2, 92. Both averages are 20.
  • Medium : In the second group four people are very poor and one is very rich, yet the average looks good.
  • Exam-type : If the average income of a country rises over time, we cannot conclude that every section has become better off.
Remember

Per capita income = total income of the country ÷ its population. Use it to compare, but also ask how fairly it is shared.

Common mistake

Believing that equal averages mean equal development. The sharing of income can be very different.

Shortcut

Memory clue: T-P-A — Total ÷ Population = Average.

Spot the difference

PointTotal incomePer capita income
MeaningIncome of all residentsTotal income ÷ population
Useful forSize of the economyComparing countries
LimitationIgnores populationHides unequal sharing

Practice questions

Easy
  1. 1What is per capita income?
  2. 2Which body groups countries as rich or low-income using per capita income?
  3. 3Under which World Bank group does India fall?
Medium
  1. 4A village has a total income of Rs 8,00,000 and 40 people. Find its per capita income.
  2. 5Why is average income better than total income for comparing countries?
  3. 6Two countries have equal average income. What else must we check?
Challenging
  1. 7Four people earn 10, 12, 8 and 70 (in thousands). Find the average and say if it describes the group well.
  2. 8The average income of a country has risen for ten years. Can we say everyone has gained? Explain.
Show answers (try them yourself first)
  1. 1The total income of a country divided by its population.
  2. 2The World Bank.
  3. 3Low middle income countries.
  4. 48,00,000 ÷ 40 = Rs 20,000.
  5. 5Countries have different populations, so total income does not show what an average person earns.
  6. 6How the income is shared (distribution) among the people.
  7. 7(10 + 12 + 8 + 70) ÷ 4 = 25 thousand. It describes the group poorly, because three earn about 10 and one earns 70.
  8. 8No. An average can rise even if only a few people gain and many gain nothing.

Income and other criteria: health and education

From daily life

Two neighbours earn the same monthly pay. One lives where the school is far, the clinic is closed and the water is unsafe. The other lives where all of these are close by. Same income, very different quality of life.

Simple definition

Income alone does not tell the quality of life, so we also look at indicators. The Infant Mortality Rate (IMR) is the number of babies who die before age one for every 1,000 live births. The literacy rate is the share of people aged 7 and above who can read and write. The net attendance ratio is the percentage of children of an age group who attend school. Kerala earns less per person than Haryana, yet has a much lower IMR and higher literacy.

State P: higher income per personState Q: lower income per personBut Q has fewer baby deaths (IMR)And Q has more people who can read

In the figure : A state with more income per person can still lag in health and schooling.

Rule 1: Income alone is not enough to judge development — States with a higher per capita income can still have more infant deaths and fewer children in school, so we need health and education indicators too.

  • Easy : State P earns more per person than State Q, yet fewer of its babies survive their first year.
  • Medium : Kerala has a lower per capita income than Haryana but a lower infant mortality rate and a higher literacy rate.
  • Exam-type : In Bihar nearly one third of children aged 15–17 do not attend secondary school; this is a gap that income figures do not show.

Rule 2: Learn the three indicators with a simple calculation — IMR is per 1,000 live births; the literacy rate is a percentage of people aged 7 and above; the net attendance ratio is a percentage of the age group.

  • Easy : 6 babies die out of 1,000 born, so IMR is 6.
  • Medium : 15 babies die out of 600 born: 15 ÷ 600 × 1,000 = 25.
  • Exam-type : Out of 500 children aged 15–17, 350 attend school: 350 ÷ 500 × 100 = 70 per cent attendance, so 30 per cent are out of school.
Remember

IMR is out of every 1,000 births; literacy and attendance are percentages. Lower IMR and higher literacy mean better development.

Common mistake

Writing IMR as a percentage. It is always per 1,000 live births.

Shortcut

Memory clue: I-1000, L-7+, A-15–17 — IMR per 1,000, Literacy age 7 and above, Attendance for ages 15–17.

Spot the difference

IndicatorMeasuresUnit
Infant Mortality RateBabies dying before age onePer 1,000 live births
Literacy rateLiterate people aged 7 and abovePer cent
Net attendance ratioChildren of an age group attending schoolPer cent

Practice questions

Easy
  1. 1What does IMR stand for?
  2. 2IMR is calculated per how many live births?
  3. 3Which state, Kerala or Haryana, has the lower per capita income?
Medium
  1. 49 babies die out of 450 born. Find the IMR.
  2. 5Why does Kerala do better than Haryana in health and education despite lower income?
  3. 6What does a low net attendance ratio in secondary classes tell us?
Challenging
  1. 7In a district 840 of 1,200 children aged 15–17 attend school. Find the net attendance ratio and the percentage out of school.
  2. 8A state tops the income list but not the IMR list. What should its government do?
Show answers (try them yourself first)
  1. 1Infant Mortality Rate.
  2. 21,000.
  3. 3Kerala.
  4. 49 ÷ 450 × 1,000 = 20.
  5. 5Because it has adequate basic health and education facilities that everyone can use.
  6. 6Many children of that age are out of school.
  7. 7840 ÷ 1,200 × 100 = 70 per cent attend; 30 per cent are out of school.
  8. 8Spend more on health and education facilities, so that good income turns into good living.

Public facilities

From daily life

You study in a school that was built for the whole village. If every family had to build its own school, only a few could afford one. Many good things in life are cheaper and fairer when provided together.

Simple definition

Public facilities are goods and services provided collectively, such as schools, hospitals, roads, safe drinking water and the ration shop (Public Distribution System, PDS). Money in your pocket cannot buy a pollution-free environment or protect you from an infectious disease unless the whole community acts. So the government must make sure these facilities reach everyone.

School: one building, many childrenHospital: care close to the villageSafe water: one tank, every houseRation shop: grain at a fair price

In the figure : Shared facilities serve many people at a low cost per person.

Rule 1: Some things are best provided collectively — Collective provision is cheaper per person and reaches everybody, while buying individually is costly and leaves many people out.

  • Easy : One street light for a lane costs less than a guard for every house.
  • Medium : A government school lets hundreds of children study; a private tutor for each child would cost far more.
  • Exam-type : Stopping an infectious disease needs the whole community to take preventive steps, which the money of one family cannot achieve.

Rule 2: Good facilities need more than money spent — How well a scheme is run and used also matters. Two states may spend similarly yet get different results.

  • Easy : A ration shop that opens on time and is honest helps people; a shop that stays closed does not.
  • Medium : In a state where most rural families use the ration shop, their food and health are likely to be better.
  • Exam-type : Kerala has a low infant mortality rate because it provides adequate basic health and education facilities, not because it is the richest state.
Remember

Public facilities are shared goods and services such as schools, health care, safe water and the ration shop. The government has to provide them for all.

Common mistake

Thinking that rich people can buy everything they need. A clean environment and protection from disease need action by the whole community.

Shortcut

Memory clue: S-H-W-R — School, Health, Water, Ration shop: the four basic public facilities.

Spot the difference

PointIndividual provisionCollective provision
Cost per personHighLow
Who benefitsThose who can payEveryone
ExampleA private guard for one houseStreet lighting for a locality

Practice questions

Easy
  1. 1Name two public facilities.
  2. 2Why can money alone not buy a pollution-free environment?
  3. 3What does PDS stand for?
Medium
  1. 4Who must make sure that basic facilities like schools and health care reach everyone?
  2. 5Why is collective security for a locality cheaper than a guard for each house?
  3. 6Why can two states with similar health spending show different results?
Challenging
  1. 7A locality of 200 families needs a water pump costing Rs 2,00,000. Find the cost per family if all share it, and compare with a small private pump costing Rs 40,000 per family.
  2. 8'Kerala's low infant mortality comes from facilities, not only from income.' Explain in two lines.
Show answers (try them yourself first)
  1. 1Any two: schools, hospitals, roads, safe drinking water, ration shops.
  2. 2Pollution and disease affect the whole community, so no single family can escape them by its own money.
  3. 3Public Distribution System.
  4. 4The government.
  5. 5The cost is shared by many families, so each pays much less.
  6. 6Because the way schemes are managed and used differs, such as how well ration shops or health centres work.
  7. 7Shared: 2,00,000 ÷ 200 = Rs 1,000 per family; a private pump costs Rs 40,000, which is 40 times as much.
  8. 8Kerala provides adequate basic health and education to all, so even with lower income its babies survive better.

Human development and our neighbours

From daily life

A report card shows marks in many subjects, not just one. A country's report card for its people also needs more than one number: income, health and schooling together.

Simple definition

Because income alone is not enough, the United Nations Development Programme (UNDP) publishes the Human Development Report. It compares countries on three things: people's health (life expectancy at birth), their education (mean years of schooling) and their income (per capita income measured so that one dollar buys the same goods everywhere, called purchasing power parity). Together they form the Human Development Index (HDI), on which countries are ranked.

Health: life expectancy at birthEducation: mean years of schoolingIncome: per capita income (PPP)Together they give the HDI rank

In the figure : HDI combines health, education and income into one ranking.

Rule 1: HDI looks at health, education and income — Life expectancy at birth is the average length of life a newborn can expect; mean years of schooling is the average years of education of people aged 25 and above. People and their well-being come first.

  • Easy : A baby born in a country with life expectancy 74 can expect about 74 years of life on average.
  • Medium : A country with high income but few years of schooling and short lives gets a lower HDI rank than its income alone would suggest.
  • Exam-type : The World Bank groups countries mainly by per capita income, whereas UNDP uses health, education and income together.

Rule 2: Neighbouring countries show that income is not everything — In the data for India and its neighbours, Sri Lanka is ahead of India in every item given. Bangladesh has a lower per capita income than India, yet its people live longer on average.

  • Easy : Sri Lanka's HDI rank is much better than India's.
  • Medium : Bangladesh people can expect a longer life than Indians even though its income per person is lower.
  • Exam-type : So a country should improve health and education along with income if it wants a high human development rank.
Remember

HDI = health + education + income. The UNDP ranks countries on it; the word 'Human' shows that people come first.

Common mistake

Believing that a higher per capita income always means a higher HDI rank. Health and education count too.

Shortcut

Memory clue: H-E-I — Health, Education, Income: the three parts of HDI.

Spot the difference

PointWorld BankUNDP (Human Development Report)
BasisPer capita incomeHealth, education and income
ResultRich and low-income groupsHDI rank
ShowsHow rich a country isHow well its people live

Practice questions

Easy
  1. 1Which organisation publishes the Human Development Report?
  2. 2Name the three things the HDI looks at.
  3. 3What is life expectancy at birth?
Medium
  1. 4Which neighbour of India, as per the data, has a longer life expectancy despite a lower per capita income?
  2. 5Why is the word 'Human' important in 'Human Development'?
  3. 6How does the UNDP method differ from the World Bank method?
Challenging
  1. 7Country P has high income but low schooling; country Q has lower income but good health and schooling. Which may rank better in HDI? Why?
  2. 8Why is income converted so that one dollar buys the same goods in every country?
Show answers (try them yourself first)
  1. 1The United Nations Development Programme (UNDP).
  2. 2Health, education and income.
  3. 3The average length of life a person can expect at birth.
  4. 4Bangladesh.
  5. 5It shows that what matters most in development is people, their health and their well-being.
  6. 6The World Bank mainly uses per capita income; the UNDP uses health, education and income together.
  7. 7Q may rank better, because HDI also counts health and education, not income alone.
  8. 8So that incomes of different countries can be compared fairly.

Sustainability of development

From daily life

A family draws water from a well. If they take out more each day than the rain refills, one summer the well will go dry. Development that uses up what future children will need is like that.

Simple definition

Sustainable development means meeting today's needs without spoiling the chance of future generations to meet theirs. Renewable resources such as crops and groundwater are replenished by nature, but they can still be overused. Non-renewable resources such as crude oil have a fixed stock and will be exhausted, even though new stocks may be discovered. Damage to the environment does not stop at state or national borders.

Water in the tank (litres) at the end of each month10000850170025503400425051006

In the figure : If water is drawn faster than it is refilled, the stock keeps falling.

Rule 1: Renewable resources can also be overused — If we use more than nature replenishes, the stock falls. Groundwater is falling in many districts of India, especially where farming is prosperous and in fast-growing cities.

  • Easy : A pond that is drained faster than rain fills it will dry up.
  • Medium : Pumping out groundwater for crop after crop faster than the rain recharges it lowers the water level.
  • Exam-type : Groundwater is a renewable resource, yet in many parts of India it is under serious threat of overuse.

Rule 2: Non-renewable resources will run out — Crude oil reserves are limited. Countries with small reserves, like India, must import oil, so a rise in oil prices is a burden on everyone.

  • Easy : Coal burnt today cannot be burnt again by our grandchildren.
  • Medium : A country that imports most of its oil suffers when the price of oil goes up.
  • Exam-type : New discoveries add to the stock, but over time even these get exhausted.
Remember

Sustainable means meeting present needs without harming the future. Use renewable resources within their refill rate and non-renewable ones wisely.

Common mistake

Thinking that only non-renewable resources can run out. Renewable resources can be overused as well.

Shortcut

Memory clue: R-N — Renewable can Refill (do not overuse); Non-renewable are Never refilled.

Spot the difference

PointRenewableNon-renewable
MeaningReplenished by natureFixed stock that gets exhausted
ExampleCrops, groundwaterCrude oil, coal
DangerOveruse beyond the refill rateRunning out over time

Practice questions

Easy
  1. 1What is sustainable development?
  2. 2Give one example each of a renewable and a non-renewable resource.
  3. 3Is groundwater a renewable or non-renewable resource?
Medium
  1. 4Why do countries like India import crude oil?
  2. 5Why can a renewable resource also run out?
  3. 6Why is environmental damage a problem for all and not for one country alone?
Challenging
  1. 7A tank holds 1,000 litres. Rain adds 300 litres a month and a family uses 450 litres a month. In which month does the tank become empty?
  2. 8How does overuse of groundwater today harm future generations?
Show answers (try them yourself first)
  1. 1Development that meets present needs without harming the ability of future generations to meet their needs.
  2. 2Renewable: crops or groundwater. Non-renewable: crude oil or coal.
  3. 3Renewable.
  4. 4Because they do not have enough crude oil reserves of their own.
  5. 5If we use it faster than nature replenishes it, the stock falls.
  6. 6Environmental damage does not respect borders, so our future is linked together.
  7. 7The tank loses 450 − 300 = 150 litres a month, and 1,000 ÷ 150 is about 6.7, so it becomes empty in the 7th month.
  8. 8Less water is left for them, so wells dry up and farming and drinking water become difficult.