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Economic Development and Growth Analysis

Description: This quiz covers the concepts of economic development and growth analysis, focusing on the factors that influence economic growth, theories of economic development, and the challenges and opportunities associated with economic development.
Number of Questions: 15
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Tags: economic development economic growth theories of economic development economic development challenges and opportunities
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What is the primary objective of economic development?

  1. To increase the standard of living

  2. To reduce poverty and inequality

  3. To promote sustainable economic growth

  4. To improve the quality of life


Correct Option: D
Explanation:

Economic development aims to improve the overall well-being of a population by increasing their standard of living, reducing poverty and inequality, promoting sustainable economic growth, and creating opportunities for a better quality of life.

Which theory emphasizes the role of capital accumulation in economic growth?

  1. Classical Economic Theory

  2. Keynesian Economic Theory

  3. Neoclassical Economic Theory

  4. Marxian Economic Theory


Correct Option: C
Explanation:

Neoclassical Economic Theory, particularly the Solow-Swan model, emphasizes the role of capital accumulation, technological progress, and labor force growth in driving economic growth.

What is the concept of 'structural transformation' in economic development?

  1. The shift from agriculture to manufacturing

  2. The transition from traditional to modern economic sectors

  3. The movement of labor from rural to urban areas

  4. The increase in the share of services in the economy


Correct Option: B
Explanation:

Structural transformation in economic development refers to the transition from traditional economic sectors, such as agriculture, to more modern and productive sectors, such as manufacturing and services.

Which theory emphasizes the importance of institutions and social factors in economic development?

  1. Classical Economic Theory

  2. Keynesian Economic Theory

  3. Neoclassical Economic Theory

  4. Institutional Economic Theory


Correct Option: D
Explanation:

Institutional Economic Theory, as propounded by economists like Douglass North and Daron Acemoglu, emphasizes the role of institutions, social norms, and political structures in shaping economic development outcomes.

What is the term used to describe the process of countries catching up to more developed economies?

  1. Convergence

  2. Divergence

  3. Structural Transformation

  4. Economic Transition


Correct Option: A
Explanation:

Convergence in economic development refers to the process by which less developed countries experience faster economic growth rates than more developed countries, leading to a narrowing of the gap in income levels.

Which theory emphasizes the role of technological innovation in economic growth?

  1. Classical Economic Theory

  2. Keynesian Economic Theory

  3. Neoclassical Economic Theory

  4. Endogenous Growth Theory


Correct Option: D
Explanation:

Endogenous Growth Theory, pioneered by economists like Paul Romer and Robert Lucas, emphasizes the role of technological innovation, human capital accumulation, and knowledge spillovers in driving economic growth.

What is the term used to describe the phenomenon where economic growth leads to environmental degradation?

  1. Environmental Kuznets Curve

  2. Ecological Footprint

  3. Carbon Footprint

  4. Tragedy of the Commons


Correct Option: A
Explanation:

The Environmental Kuznets Curve (EKC) illustrates the relationship between economic growth and environmental degradation, suggesting that as countries develop, they initially experience environmental degradation, but eventually reach a turning point where environmental quality improves with further economic growth.

Which theory emphasizes the role of entrepreneurship and innovation in economic development?

  1. Classical Economic Theory

  2. Keynesian Economic Theory

  3. Neoclassical Economic Theory

  4. Schumpeterian Economic Theory


Correct Option: D
Explanation:

Schumpeterian Economic Theory, developed by Joseph Schumpeter, emphasizes the role of entrepreneurship, innovation, and creative destruction in driving economic growth and structural transformation.

What is the term used to describe the process of countries falling behind more developed economies?

  1. Convergence

  2. Divergence

  3. Structural Transformation

  4. Economic Transition


Correct Option: B
Explanation:

Divergence in economic development refers to the process by which the gap in income levels between developed and less developed countries widens over time.

Which theory emphasizes the role of government intervention and public policy in economic development?

  1. Classical Economic Theory

  2. Keynesian Economic Theory

  3. Neoclassical Economic Theory

  4. Development Economics Theory


Correct Option: D
Explanation:

Development Economics Theory, as propounded by economists like Amartya Sen and Paul Krugman, emphasizes the role of government intervention, public policy, and institutional reforms in promoting economic development, particularly in less developed countries.

What is the term used to describe the phenomenon where economic growth leads to increased income inequality?

  1. Kuznets Curve

  2. Gini Coefficient

  3. Lorenz Curve

  4. Palma Ratio


Correct Option: A
Explanation:

The Kuznets Curve illustrates the relationship between economic growth and income inequality, suggesting that inequality initially increases during the early stages of economic development but eventually declines as countries reach higher levels of development.

Which theory emphasizes the role of human capital and education in economic development?

  1. Classical Economic Theory

  2. Keynesian Economic Theory

  3. Neoclassical Economic Theory

  4. Human Capital Theory


Correct Option: D
Explanation:

Human Capital Theory, developed by economists like Gary Becker and Jacob Mincer, emphasizes the role of human capital, education, and skill development in driving economic growth and improving productivity.

What is the term used to describe the phenomenon where economic growth leads to increased environmental sustainability?

  1. Environmental Kuznets Curve

  2. Ecological Footprint

  3. Carbon Footprint

  4. Green Growth


Correct Option: D
Explanation:

Green Growth refers to the concept of achieving economic growth while minimizing environmental degradation and promoting sustainable resource use.

Which theory emphasizes the role of natural resources and resource endowments in economic development?

  1. Classical Economic Theory

  2. Keynesian Economic Theory

  3. Neoclassical Economic Theory

  4. Resource Curse Theory


Correct Option: D
Explanation:

The Resource Curse Theory suggests that countries with abundant natural resources may experience slower economic growth and development due to factors such as Dutch Disease and the volatility of commodity prices.

What is the term used to describe the phenomenon where economic growth leads to increased social mobility and reduced poverty?

  1. Kuznets Curve

  2. Gini Coefficient

  3. Lorenz Curve

  4. Social Progress Index


Correct Option: D
Explanation:

The Social Progress Index is a composite measure that assesses the social and environmental performance of countries, including indicators such as health, education, and environmental sustainability.

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