Nepal Administrative Staff CollegePublic Service Training Department

Professional Course on Management and Developmentfor Class III Officers of the Government of Nepal

Module V: Approaches to Development

Session onDevelopment Perspectives

Yuba Raj BhusalApril 10, 2015

Table of Contents

1. Concept of Development2. General Theories of Development3. Problems of Underdevelopment 4. Need and Practices of Planned

Development5. Rio+20 (2012) and 4 Pillars of SD6. Recent Trends in Development with

reference to Nepal

1. Concept of Development1.1 Meaning:Almost every writer (economist, educationist, political scientist, bureaucrat etc.) defines ‘development’ differently depending upon one’s own orientation. Generally, ‘development’ can be defined:•as a state or condition-static;•as a process/course of change- dynamic;It is a multi-dimensional process involving reorganization and reorientation of entire socio-economic system. As a process, it improves the quality of all human lives with three equally important aspects as under.

1.2 Objectives of Development

a) Raising peoples’standard of living through enhanced income, consumption, medical services, education;

b) Creating conditions conducive to the growth of peoples’ self-esteem through the establishment of social, political and economic systems and institutions which promote human dignity and respect;

c) Increasing peoples’ freedom to choose by enlarging the range of their choice variables, e.g. varieties of goods and services;

d) Other objectives associated to (human, societal) development.

1.3 Interpretations of Development• Development as Economic Growth- too often

commodity output as opposed to people is emphasized-measures of growth in GNP.

• Development as Modernization- emphasizes process of social change which is required to produce economic advancement; examines changes in social, psychological and political processes;

• Development as Distributive Justice- view development as improving basic needs particularly for the target groups include small farmers, landless, urban under-employed and unemployed people;

• Marxism emphasizes on the Mode of Production - elements and activities necessary to produce and reproduce real, material life;

• Capitalist (market economy) mode depends on wage labor whose labor power produces a surplus which is accumulated and appropriated by the employer-result is often class conflict in capitalist societies;

• Neo-colonial Dependence:– Existence of underdevelopment due to historical

evolution of an unequal international capitalist system of rich country-poor country relations;

– Sets up center (developed countries) versus periphery (developing countries) contrast;

– Attempts to become self-reliant and progressive are suppressed by this relationship;

– Elites in the developing world (e.g landlords, entrepreneurs, merchants) enjoy high incomes, social status and political power and thus perpetuate inequality and conformity and are rewarded;

– Elites serve international power groups such as multi-national firms, assistance agencies (World Bank) and other agents.

• Sustainable DevelopmentDevelopment is likely to achieve lasting satisfaction of human needs and improvement of the quality of life and encompasses:Help for the very poorest who are left with no option but

to destroy their environment to survive; Idea of self-reliant development with natural resource

constraints;Cost effective development using different economic

criteria to the traditional –i.e. development should not degrade environment;

Important issues of health control, appropriate technologies, food self-reliance, clean water and shelter for all;

People centered activities are necessary- human beings are the resources in the concept.

2. General Theories of Development2.1 Keynesian Growth Theory (1940s): • Process of capital formation is determined by

savings and investment;• Domestic savings are channeled to productive

investments such as manufacturing which result –usually-in high productivity;

• Growth is market driven as income levels rise, savings rises and frees capital for alternative investment;

(John M. Keyns: The General Theory of Employment, Interest and Money, 1936).

2.2 Modernization Theory (1950s-60s) – – Suggests economic dimension alone is insufficient and

adds theories on institutional and social change;– Incorporates non-economic elements such as social

practices, beliefs, values and customs; – Diffusion and speed of change is critical as is removal of

various cultural and social barriers;– Backward internal structures-rather than external

factors-cause underdevelopment.2.3 Neo-liberal Development Theory (1970s):

– Designed to counteract impact of Keynesian theory;– New emphasis on supply side factors in development-

private initiatives and market led growth;– Move away from demand stimulation (interest rate

manipulation), import substitution, state intervention and centralized planning;

– Gradual industrialization with ‘trickle down’ of benefits to all social classes;

2.4 Popular Development (1980s):– Avoids grand theories and emphasizes solutions

viewed in context of development which is part of historical process;

– Context of development is constantly changing in scale and time;

– Accommodates geographical and historical diversity;

– Theory of little use to practitioners of development;– Stresses local diversity, human creativity, process of

social change through pragmatism, flexibility and context;

– Not extent of state intervention but comparative advantages of public and private sectors and their complementarity.

2.5 World Bank Model:–WB has adopted several new policies and programs geared to promoting a more holistic, participatory, and results-based approach to development and poverty reduction. –This approach incorporates the notion that development must be

• inclusive, • comprehensive, and • country-owned

in order to be effective and sustainable over the long term.

3. Problems of Underdevelopment

3.1 Characteristics of underdevelopment: – low per capita income, – low literacy and educational attainment, – lack of basic services- water and power,– Other characteristics: political instability, conflict etc.

• Absence of development caused by certain physical environments, particular cultural traditions and value systems-environmental and cultural determinism;

• Lack of natural resources certainly impediment to development but not impossible- example of Japan.

3.2 Reasons for Japanese Success:• Strong cooperation between government and

business;• Able to adapt to spatial-physical situation and acquire

a maritime prowess;• Early development during the Meiji restoration with

renovation, revolution, reform/ renewal that restored under Emperor Meiji (1868-1912);

• The restoration facilitated for the emergence of Japan as a modernized nation in the early twentieth century, with the provision of transport and banking systems;

• Highly literate population;• Niche development- technology driven.

3.3 Other Common Explanations of Underdevelopment

• Instability and other adverse internal situations- political factors;

• Some truth to this as extended periods of turbulence are not conducive to development- central African nations with tribal rivalries and ethnic cleansing;

• Poor physical environment- lack of rainfall, poor soils also may pose barriers to development;

• Prevalence of extractive institutions and lack of inclusive institutions both in political and economic sectors.

3.4 Vicious Circles- Gunnar Myrdal

• Complex web of interlocking vicious circles each of which constitutes a chain of cause and effect relationships where one unfavorable circumstance leads to another and produces downward spiral;

• High Birth Rate> Large Families>Low PCI> Poverty> Low Output Per Worker>;

• Low PCI> Low Productivity> Poor Health>Inadequate Housing;

• Remedy > Downward spiral not reversible without massive aid.

3.5 Remedy for Vicious Circle• Aid would stimulate growth in modern sector

and reduce size of ‘informal’ or traditional sector;

• Eliminate dualism and the major causes of unequal distribution of wealth;

• Foreign aid would allow countries to increase low levels of productivity;

• Needs to develop a Virtuous Circle of Prosperity against the Vicious Circle of Poverty.

4. Need and Practices of Planned DevelopmentFactors of Production: Land, Labor, Capital, Entrepreneurship, Technology including ICT.

4.1 Historiography of the World: Up to the Industrial Revolution;4.2 Karl Marx and Engel's proposition;4.3 Rise of Soviet Union and the Socialist Planning System;4.4 Great Depression of 1930s and the Keynesian Economics;4.5 Welfare Economics: Post-war period4.6 W.W. Rostow’s Economic Growth model:The stages of economic growth constituted five milestones:a) traditional society:b) pre-take off:c) the take off:d) the drive to maturity:e) maturity: mass consumption.

4.7 Growth Pole approach (F. Perroux 1955)• Development of a core region or growth pole. • Leading to spread effects benefiting the country as a

whole. • Development of a specific location through

agglomeration (Special Economic Zones, Economic Processing Zones).

• Economies of scale of the largest urban centers would provide higher rates of return on investment, support the commercial services needed by the industries to operate efficiently and bring about the diversification of the growth pole’s economy.

• Spread and backwash effects to be realized (complementarities of agricultural production and manufacturing through backward and forward linkages in the hinterland and urban centers).

4.8 Trickle down approach: • Richer individuals and larger companies are

the thriving force behind economic growth. • The wealth created by the more successful

parts of the economy and more successful people will naturally tricle down and benefit everyone.

• Low taxation and lack of regulation is expected.

4.9 Decentralization: • Bottom up or grass roots development.• Local involvement in the DM process, where local

people identify their needs for effective solution. • Use apt technology. • Long term aim is sustainability.4.10 Regional Development/ Balanced Development: • focus on developing the peripheral regions. • Reduce regional disparities which develop from an

uneven development of the core periphery. • Attempts to reduce rural to urban migration. • Investments in infrastructures-transportation,

communication and electricity to link the region more with the core.

4.11 Agro-politan Development (J. Friedman 1975)• Any larger urban centers in rural area tend to exploit

the rural people. The urban elites, traders, local industries, and the investment in the urban centers will drain resources away from the rural population.

• To overcome this process, investment should be concentrated in the rural areas where the masses have access to facilities and services.

• Three essential conditions for successful agro-politan development: selective territorial closure, the communalization of productive wealth, the equalization of access to the bases for the accumulation of social power against the dominance of elites’ power.

4.12 Self-reliant territorial development(SRTD):

J. Friedman, 1979 devised five principles of SRTD:– aims to diversify the territorial economy;– maximum development of physical resources

consistent with principles of conservation;– encourage the expansion of regional and inter-

regional markets;– base as much as possible on principles of self-

reliance; and– promote social learning.

4.13 IRDP 1970s• Poverty alleviation and meeting basic needs of the rural

people become the core objective of IRDP. • Economic growth (increased agricultural and off farm

production, increased productivity, higher rural incomes, improved infrastructures and technological modernization in the countryside) and poverty alleviation (transfer of assets to and creation of jobs for the poor and the satisfaction of their basic minimum needs) were the two major thrusts of IRDP. Its elements are:

• multi-sectoral nature of projects;• limitation of the area of intervention (area planning, district

planning);• emphacis on local participation and mobilization; and• explicit reference to poverty alleviation and to the basic

minimum needs of the poor.

4.14 Basic Needs Approach (ILO 1972)

• Shifting from growth oriented development strategy the basic needs approach was proposed as a new focal point for development.

• ILO (1977) defines it as under:– minimum requirements of a family for

consumption are adequate food, shelter and clothing in cluding household equipment and furniture.

– Essential services provided by for the community at large, i.e., safe drinking water, sanitation, public transport, health and education facilities.

4.15 Functional-spatial Integration (D. Rondinelli, 1983)• It is about the integrated spatial development.• Development encompasses rural and urban areas.• Without an articulated and integrated system of growth

centers- as opposed to one or few growth poles- the impulses of concentrated investment couldn’t spread and the economic incentives for widespread productivity could not be created.

• A decentralized concentration is needed. • A crucial element in providing the basic preconditions for the

commercialization of agriculture is a well articulated and integrated system of settlements in which services and facilities can be efficiently located and to which rural people have easy access.

4.16 WID, WAD, GAD (1980s):Women in Development, Women & Development, Gender &

Development.

4.17 Right to Development (RTD) 1970s/80s:• Advocated since 1972 (Int'l Institute of HR);• Popularly known as the third generation human rights (first

generation: civil and political rights; second generation: economic, social and cultural rights);

• Consists: solidarity rights, and issues of global concerns (development, environment, humanitarian assistance, peace, communication, and common heritage);

• Development policies to meet the human centered and participatory elements of the definition contained in the Declaration;

• Fair distribution of benefits of development and non-discrimination in development;

• Empowerment of civil society.

Three Dimensions of RTD:• Political: contending perspectives and interests

seeking to influence the formulation of the general principles at the HR Commissions;

• Economic: focusing on equity and poverty reduction in the policies and practices in the financing of development;

• Social: willingness of several development agencies to integrate in HR concepts with respects to RTD.In essence, food, education, health and voice of the vulnerable groups including the women.

4.18 Sustainable development:Development that fulfills the needs of the present without limiting the potential for meeting the needs of future generations (the World Commission on Environment and Development, 1987).Rio conference 1992 and Rio+ 20 outcomes.

• UNDP (HDR, 1992) devised some minimum requirements for Sustainable Development:– Elimination of poverty;– Reduction in population growth;– Equitable distribution of resources;– Healthier, better educated and trained people;– Decentralized and more participatory government;– Equitable and liberal trading system within/ among the countries;– Increased production for local consumption;– Better understanding of diversity of eco-systems, locally adapted

solutions to environmental problems and better monitoring of the environmental impact of development activities.

• RIO + 20 and 3 Pillars (social, economic, environmental+ institutional) of sustainable Development.

4.19 Inclusive development 2010s• Building capacity within organizations and

institutions to offer persons with disabilities better access to their services.

• And hence to better health, education and employment possibilities.– Geographical– Social – Other

5. Rio+20 (2012) and 4 Pillars of SD:5.1 The Rio+20 Outcome Document emphasized in the three pillars of SD- social, economic and environmental- and added the fourth one institutional, which addresses key institutional policy and capacity issues. It highlighted in the practice and meanings associated with the production, use and management of resources eventually leading to reduce poverty; the relationship between humans and their natural, social and built environments such as air, water, food, shelter & the type of energy.

The fourth pillar 'Institutional' focuses on the capacity building and thus calls for:

• strengthening technical and scientific cooperation, including North-South, South-South and triangular cooperation;

• developing human resources including training, exchange of experiences and expertise, knowledge transfer and technical assistance, which involves strengthening institutional capacity, including planning, management and monitoring capacities.

• implementing the Bali Strategic Plan for Technology Support and Capacity-building, adopted by the UNEP.

• participation and representation of wo/men scientists and researchers from developing/developed countries in processes related to global environmental and sustainable development assessment and monitoring, with the purpose of enhancing national capabilities and the quality of research for policy- and decision-making processes.

• inviting all the UN Agencies and other relevant international organizations to support developing countries and, in particular, the least developed countries in capacity-building for developing resource-efficient and inclusive economies, including through: – sharing sustainable practices in various economic sectors;– enhancing knowledge and capacity to integrate disaster risk

reduction and resilience into development plans; – supporting North-South, South-South & triangular cooperation

for the transition to a resource-efficient economy; and – promoting public-private partnerships.

5.2 Sustainable Development GoalsRio+20 Conference built a consensus to launch a process to develop a set of SDGs, based upon the MDGs and converge with the Post-2015 development agenda. It was also decided to establish an "inclusive and transparent intergovernmental process open to all stakeholders, with a view to developing global SDGs. In the Rio+20 outcome document, member States agreed that sustainable development goals (SDGs) must: a) be based on Agenda 21 and the Johannesburg Plan

of Implementation.b) fully respect all the Rio Principles.c) be consistent with international law.d) build upon commitments already made.e) contribute to the full implementation of the

outcomes of all major summits in the economic, social and environmental fields.

f) focus on priority areas for the achievement of sustainable development, being guided by the outcome document.

g) address and incorporate in a balanced way all three dimensions of sustainable development and their inter-linkages.

h) be coherent with and integrated into the United Nations development agenda beyond 2015.

i) not divert focus or effort from the achievement of the Millennium Development Goals.

j) include active involvement of all relevant stakeholders, as appropriate, in the process.

The outcome document mandated the creation of an inter-governmental Open Working Group, that will submit a report to the 68th Session of the UNGA containing a proposal for SDGs for consideration and appropriate action. Debates, discussions were held at the local, national, sub-regional, & regional level to come up with a concrete Post-2015 Development Agenda / the SDGs.

The proposed sustainable development goals are:1. End poverty in all its forms everywhere;2. End hunger, achieve food security and improved nutrition,

and promote sustainable agriculture;3. Ensure healthy lives and promote well-being for all at all

ages;4. Ensure inclusive and equitable quality education and

promote life-long learning opportunities for all;5. Achieve gender equality and empower all women & girls6. Ensure availability and sustainable management of water

and sanitation for all;7. Ensure access to affordable, reliable, sustainable, and

modern energy for all;8. Promote sustained, inclusive and sustainable economic

growth, full and productive employment and decent work for all;

9. Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation;

10. Reduce inequality within and among countries;11. Make cities and human settlements inclusive, safe, resilient

and sustainable;12. Ensure sustainable consumption and production patterns;13. Take urgent action to combat climate change and its impacts;14. Conserve and sustainably use the oceans, seas and marine

resources for sustainable development;15. Protect, restore and promote sustainable use of terrestrial

ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss;

16. Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels;

17. Strengthen the means of implementation and revitalize the global partnership for sustainable development.

6. Recent Trends in Development with reference to Nepal

• SDGs/ MDGS/ Post-2015 Development Agenda;• LDC Graduation 2020/2032 and Nepal's Graduation

from LDC to DC 2022;• Access to Energy: SE4All by 2030;• Open Defecation Free (ODF) world 2030 (Nepal 2017);• Poverty eradication by 2030;• Education for all (Nepal) by 2015;• Conflict/ peace sensitive development;• Climate change, REDD+ etc.;• New Constitution as panacea for overall development;• Federalization for accelerated development.

THANK YOU