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EAE 204: Economic Development Lecture Notes

Institution: Kenyatta University

Course: Bachelor of Economics

Content Category: Lecture Notes

Posted By: davidkariuki1010

Document Type: DOCX

Number of Pages: 121

Price: KES 200
 
    

Views: 526     Downloads: 6

Summary

TABLE OF CONTENTS

I. INTRODUCTION 3
II. COURSE OBJECTIVES 3
III. COURSEWORK AND READING 4
IV. REFERENCES 4
V. COURSE TOPICS 5
TOPIC ONE: INTRODUCTION 11
1.1 Introduction 11
1.2 Topic Objectives 11
1.4 Measurement of Elements of Development 13
1.5 Barriers to development 15
1.5.1 Vicious circles of Poverty 15
1.5.2 Low Rate of Capital Formation 16
1.5.3 Socio-cultural constraints 16
1.5.4 Agricultural constraint 17
1.5.5 Human Resource Development Constraint 18
1.5.6 Foreign Exchange Constraint 18
1.6 Topic Summary 19
1.7 Activities 20
1.8 Self Test 20
1.9 Further Reading 21
TOPIC TWO: THEORIES OF ECONOMIC DEVELOPMENT 22
2.1 Introduction 22
2.2 Topic Objectives 22
2.3 Classical Theories of Economic Growth 23
2.4 The Marxist Theory 25
2.4.1 Application to Developing Countries 26
2.4.2 Critique of the Marxian theory 27
2.5 Keynesian Theory of Economic Development 27
2.5.1 Assumptions of Keynesian Theory 28
2.5.2 Tools of Keynesian Theory 28
2.5.3 Application of Keynesian Theory in Developing Countries 30
2.6 Neoclassical Theories of Economic Development 31
2.6.1 Rostow‘s Stages of Economic Growth Theory 31
2.6.1.1 Traditional Society 31
2.6.1.2 The Pre-conditions for Take-off 32
2.6.1.3 The Take-off 32
2.6.1.4 The Drive to Maturity 35
2.6.1.5 Age of Mass Consumption 35
2.6.1.6 Application to Developing Countries 35
2.6.1.7 Limitations 35
2.6.2 Lewis Theory of Unlimited Labor Supply 36
2.6.3 The Solow Model of Economic Development 38
2.6.3.1 Limitations of Solow Model 39
2.7 Endogenous Theories of Economic Development 40
2.7.1 The Romer Model of Economic Development 40
2.7.1.1 Limitations of Romer Model 44
2.7.2 The O-Ring Theory 45
2.7.3 Sen‘s Welfare Theory 47
2.8 Topic Summary 49
2.9 Activities 51
2.10 Self Test 51
2.11 Further Reading 53
TOPIC THREE: DEVELOPMENT STRATEGIES AND POVERTY ALLEVIATION 54
3.1 Introduction 54
3.2 Topic Objectives 54
3.3 Micro -Type Development Strategies 55
3.3.1 High Capital Inflow 55
3.3.2 High Primary Exports Strategy 55
3.3.3 Moderate external Capital Inflow 55
3.3.4 Low External Dependence Strategy 56
3.4 Macro -Type Strategies 56
3.4.1 Technocratic Strategy 56
3.4.2 Reformist Strategy 56
3.4.3 Radical Strategy 57
3.4.4 Basic Needs Strategy 57
3.5 Poverty, Its Measurement and Poverty Alleviation 58
3.5.2 Effects of Poverty 64
3.5.3 Measuring Poverty 67
3.5.4 Anti-poverty Programs 68
3.5.5 Determinants of Poverty in Kenya 70
3.6 Topic Summary 72
3.7 Activities 74
3.8 Self Test 75
3.9 Further Reading 76
TOPIC FOUR: VISION 2030 77
4.1 Introduction 77
4.2 Topic Objectives 77
4.3 Foundations for Socio -Economic Transformation 78
4.3.1 Infrastructure 78
4.3.1.1 Energy as a Foundation of Vision 2030 80
4.3.2 Science, Technology and Innovation 82
4.3.3 Land Reforms 83
4.3.4 Human Resource Development 84
4.3.5 Security 85
4.4 Economic Pillar 86
4.4.1 Overview 86
4.4.2 Tourism 86
4.4.3 Agriculture 88
4.4.4 Wholesale and Retail Trade 91
4.4.5 Manufacturing 92
4.4.6 Business Process Outsourcing/Offshoring 94
4.4.7 Financial Services 95
4.5 The Social Pillar 101
4.5.1 Overview 101
4.5.2 Education and Training 101
4.5.3 Health Care Delivery 104
4.5.4 Water and Sanitation 105
4.5.5 Environmental Management 109
4.5.6 Gender, Youth and Vulnerable Groups 111
4.5.7 Housing and Urbanisation 114
4.5.8 Social Equity and Poverty Reduction 116
4.6 Challenges Facing Implementation of Vision 2030 118
4.7 Topic Summary 119
4.8 Activities 120
4.9 Self Test 120
4.10 Further Reading 121
..................................


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