INTB 1209 Lecture Notes - Lecture 5: Amartya Sen, Gross National Income, Purchasing Power Parity

• School: Northeastern University
• Department: International Business
• Course: INTB 1209
• Professor: Carlnelson

Document Summary

Gross national income (gni)- the yardstick for measuring economic activity of a country, this measures the total annual income of a nations residents. Can be misleading because the cost of living is different in each country. Purchasing power parity (ppp)- an adjustment in gross domestic product per capita to reflect differences in cost of living. Also inaccurate because a lot of transactions in many countries are by cash and therefore go unrecorded (cid:894)(cid:862)(cid:271)la(cid:272)k e(cid:272)o(cid:374)o(cid:373)(cid:455)(cid:863)/ (cid:862)shado(cid:449) e(cid:272)o(cid:374)o(cid:373)(cid:455)(cid:863)(cid:895) Chi(cid:374)a (cid:449)ill (cid:271)e(cid:272)o(cid:373)e the (cid:449)o(cid:396)ld"s la(cid:396)gest e(cid:272)o(cid:374)o(cid:373)(cid:455) (cid:449)ithi(cid:374) the (cid:374)e(cid:454)t de(cid:272)ade. Development should be assessed less by material output measures such as gni and more by the capabilities and opportunities that people enjoy. Development is a process of expanding the real freedoms that people experience. De(cid:448)elop(cid:373)e(cid:374)t is (cid:271)oth a(cid:374) e(cid:272)o(cid:374)o(cid:373)i(cid:272) a(cid:374)d politi(cid:272)al p(cid:396)o(cid:272)ess, (cid:396)e(cid:395)ui(cid:396)es (cid:862)de(cid:373)o(cid:272)(cid:396)atizatio(cid:374)(cid:863) Human development index (hdi)- an attempt by the un to assess the impact of factors on the quality of human life in a country.