Econ 3392 (Fall 2017)

Answer

Concepts of Economic Development

Development as Growth

            Development as growth majorly features growth regarding per-capita income and the size of national economies (Perkins, 2013). This leads to expansion of capabilities in that the country will attain economic stability. However, it may not offer economic freedom to individual citizens since national growth does not necessarily translate improvement in individual income of people. In this case, growth does not guarantee freedom from poverty for the common man (Sen & Nussbaum, 2014). This economic concept, therefore, does not overlap with “development as freedom”.

Development as the Fulfillment of Basic Needs

            Fulfilment of basic needs generates freedom, hence the concept overlaps with “development as freedom” (Sen & Nussbaum, 2014). When human beings have a comfort and a free psychology, body, and mind, they start focusing on improvement of their living standards.  However, even when all basic needs are granted, an individual may not reach political freedom nor does it guarantee capability of acquiring transparency guarantees (Perkins, 2013).

Improved Governance, Gender and Civic Freedoms and Environmental Sustainability

            These ensure that the country’s capabilities are expanded to accommodate every individual and that the environment is preserved (Sen & Nussbaum, 2014). This creates room for inventions and participation of people in government agenda (Perkins, 2013). However, it does not overlap with development as freedom since economic development is not addressed.

Changes in Happiness Measures from 2006 to 2016

            From the graph below, between 2006 and 2014, the social support in Sri-Lanka shows a declining trend with slight improvements therein. However, in 2015, the margin increased from 0.8 to 0.86 which indicates a happier nation (“Sri Lanka,” 2014). This means that most people in the country believe that they can count on their friends and family for assistance when in need. This promotes social welfare and health of the population (Dayarathne, 2016).

            According to the chart below, tourism Underwent a decline between 2006 and 2008, but it is seen to maintain an upward trend between 2009 and 2016. This means that Sri-Lanka’s tourism sector has enjoyed tremendous growth hence an increase in GDP. This is a source of economic happiness for the country (“Sri Lanka,” 2014).

            According to Dayarathne (2016), youth unemployment rate in 2006 was at 23% which declined to 18% in 2008. In 2016, the rate is at 20% which is an increase from 2008 hence a reduction in happiness rate.

Extent to which Social, Political and Economic Changes during that Period Explains those Changes

            Economically, the gap of income distribution between the poor and the rich increased over the years (“Sri Lanka,” 2014). The rich became richer while the state of the poor stagnated.  The country was also subjected to unplanned growth initiatives which increased the service sector activities shared in the open economy. For instance, skilled and unskilled laborers were pulled to the free trade zone factories set up by the government.

            Policies touching on progressive tax among others that are politically imposed by successive government impacted on the-the wealthy class’s retained income negatively (Ratnayake, 2014). Similarly, lack of clear policies to deal with equality of revenue distribution made the government flow with the pro-poor growth concept to combat inequality during the growth process. This is with the hope that growth under such circumstances would result in improved living standards due to equitable distribution of resources.

            Socially, public programs have been put up by the government to deal with unemployment amongst the poor (Ratnayake, 2014). For instance, the facilitation of free healthcare and education are some of the ways to bridge social and economic differences between the wealthy and poor. However, with time, these services cannot be maintained hence the increased unemployment rates of many uneducated youths that cannot afford education (Dayarathne, 2016(2017) study employed, there are very little room for generalizing the study’s findings.