- Define and explain Development Strategies in your own words
- Use key terms such as HDI accurately
- Apply what you have learned to new examples and questions
- Avoid the common mistakes learners make with this topic
This lesson focuses on Development Strategies: evaluate aid, trade and investment as routes to growth.
Evaluate aid, trade and investment as routes to growth.
Key ideas
Routes to development
Strategies include foreign aid (which can build infrastructure but risks dependency and corruption), trade liberalisation, attracting FDI, investing in education and health, and microfinance. The East Asian tigers combined export-led growth with strong state investment in human capital — context shapes what works.
Why poverty persists
Debated causes include colonial legacies, weak institutions and corruption, geography and disease burden, rapid population growth, and poverty traps where low income means low saving, low investment and low growth. There is no single cause — and no single cure.
Key term — HDI: The Human Development Index: a composite of income, life expectancy and education, scored 0 to 1. It captures broader development than GDP alone.
Why did the East Asian tigers develop rapidly?
They combined export-led growth with heavy state investment in education and infrastructure.
Answer: They combined export-led growth with heavy state investment in education and infrastructure.
- Equating growth with development Growth raises output; development improves lives — growth without schools, clinics or rights may leave most people behind.
- Assuming aid always helps Aid can fund vital projects but also fuel corruption and dependency; its record is mixed and context-dependent.
Practice
Any one of: ignores health and education, ignores inequality, ignores the environment and unpaid work.
A cycle where low income means low saving and investment, which keeps income low.
Income (GNI per capita), life expectancy and education.
Perfect income equality.
Quick check
Which of these best defines "HDI"?
Give one advantage and one disadvantage of FDI for a developing country.
- Development Strategies: evaluate aid, trade and investment as routes to growth.
- Routes to development: Strategies include foreign aid (which can build infrastructure but risks dependency and corruption), trade liberalisation, attracting FDI, investing in education and health, and microfinance.
- foreign direct investment: Investment by multinational firms in another country, bringing capital, jobs and technology — often called FDI.
- Watch out for: equating growth with development