Economic Development · 4 question types
Past paper frequency (2018 to 2024)
This topic accounts for approximately 9% of your exam marks.
Reasons for development gaps and the role of trade, aid, and investment come up frequently in Section B; typically 6 to 8 marks.
The distinction is not just "rich" vs "poor". Each category has a recognisable set of features.
Developed countries have high GDP per capita, advanced industry and services, high HDI (topic 16), and a population structure typical of the later stages of demographic transition.
Typical characteristics:
Examples: Germany, Japan, the United States, the United Kingdom, South Korea, Australia.
Discuss: does a high-GDP country mean higher living standards?
What comes up: An 8-mark question asks whether people in countries with a high GDP enjoy higher living standards than those in countries with a low GDP.
Write (two sides): For the "yes" side: (1) higher income allows people to afford better nutrition, housing and healthcare, raising life expectancy; (2) higher incomes enable people to buy more goods and services, including education, leading to better job prospects and wellbeing. For the "might not" side: (1) a high total GDP does not necessarily mean high GDP per head — if the population is very large, average income may still be low; (2) income may be very unevenly distributed, so many people remain in poverty despite a large national income; (3) people may work very long hours, leaving little leisure time, which lowers quality of life even as incomes rise; (4) higher GDP may also bring greater pollution and congestion. Judgement: High GDP is a useful starting point but an incomplete indicator — distribution, working conditions and non-material factors all matter.
Watch out: Do not treat GDP and GDP per head as the same thing. A mark scheme will credit the distinction between total output and output per person as a separate point.
Developing countries have lower GDP per capita, a much larger primary sector, lower HDI, and a population structure earlier in the demographic transition.
Typical characteristics:
Examples: India, Nigeria, Bangladesh, Kenya, Vietnam, Bolivia.
Analyse: how does a growing tertiary sector raise living standards?
What comes up: A 6-mark Analyse question asks how growth in a country's tertiary (services) sector can increase its living standards.
Write: Each chain of reasoning needs a cause and its effect on wellbeing. (1) Services jobs tend to pay higher wages than primary work, increasing workers' purchasing power and ability to afford more goods, healthcare and education. (2) Growth in education and healthcare services raises human capital directly — workers become more skilled and healthier, which is itself part of a higher HDI. (3) A larger services sector generates higher tax revenue for the government, enabling more public spending on infrastructure, schools and hospitals, raising living standards further. (4) Services such as transport reduce travel time and costs; entertainment services expand leisure options — both improve quality of life beyond just income.
Watch out: Do not stop at "wages rise." The mark scheme rewards each step of the chain — identify the sector change, state the wage or productivity effect, then link it to a specific dimension of living standards (consumption, healthcare, education, leisure).
Both categories cover a wide range. "Developing" includes both least-developed countries (very low income, weak institutions) and emerging-market economies (middle income, fast-growing) like India, Brazil and Vietnam. A single label hides huge variation.
As countries grow richer, the structure of their economy changes in a consistent pattern.
| Sector | Share of output and employment |
|---|---|
| Primary (agriculture, mining) | High in early development, falls steadily |
| Secondary (manufacturing, construction) | Rises in mid-development, peaks, then declines |
| Tertiary (services) | Low in early development, dominates in advanced economies |
The progression is primary → secondary → tertiary as a country develops. Alongside this, urbanisation rises and birth and death rates fall (the demographic transition from topic 17).