Class 10 Economics · Chapter 1

Development

Different goals of development, income and other criteria, per capita income, HDI, public facilities and sustainability.

NCERT Understanding Economic DevelopmentCBSE Class 10 13 min read

1. Chapter at a Glance

What does it mean for a person, a state or a country to be "developed"? For a landless farm worker it may mean more days of work and better wages; for a girl in a village it may mean the freedom to study as far as her brother; for a city family it may mean clean air and safe streets. Development means different things to different people, and some goals even conflict. Yet countries must compare progress and plan for the future. This chapter asks how we can measure development fairly: by income, by health and education, by the availability of public facilities, and by whether progress can be sustained for future generations.

What you will learn
  • Different people have different and sometimes conflicting development goals.
  • Income and other goals: equal treatment, freedom, security, respect.
  • National income, per capita income and how countries are compared.
  • Why income alone is not enough — health, education and public facilities.
  • Infant mortality rate, literacy rate, net attendance ratio and the Human Development Index.
  • Sustainability of development — groundwater, oil and the environment.

2. What Development Promises — Different People, Different Goals

Category of personPossible development goals
Landless rural labourerMore days of work, better wages, a local school for children, no social discrimination
Prosperous farmer in Punjab-type regionHigher support prices, cheaper inputs, children settled abroad or in cities
Farmer depending only on rainIrrigation, crop insurance, easy credit
Rural woman from a land-owning familyEqual say in decisions, safety, education, freedom to work
Urban unemployed youthGood jobs, skill training, respect
Adivasi from a mining areaProtection of land and forest rights, fair compensation, livelihood

Two important ideas follow. First, different persons can have different development goals. Second, what is development for one may be destruction for another: a large dam may bring irrigation and electricity to many, but may also submerge the land and villages of others. Industrialists may want more power plants, while people near them may suffer from pollution. Development goals therefore have to be negotiated fairly.

3. Income and Other Goals

People usually want more income, because income buys material goods. But they also want things money cannot easily buy: equal treatment, freedom, security, respect, a safe and pleasant working environment, and opportunities to learn. A job that pays a little less but offers security and time with family may be preferred to a high-paying job with no security. Similarly, if women get paid work outside the home, their dignity and say in the household increase. So development is a mix of material and non-material goals.

4. National Development and Per Capita Income

To compare countries, we usually begin with income. The national income is the total income of all the residents of a country. But countries have very different populations, so total income does not tell us what an average person earns. We therefore use per capita income (average income):

Per capita income = Total income of the country ÷ Total population

The World Bank, in its World Development Reports, classifies countries into high-income, middle-income (upper and lower) and low-income groups using per capita income (its measure is gross national income per person in US dollars). India is placed among the lower middle-income countries.

Worked Example 1 — Why averages can hide inequality

Two countries each have five citizens. Monthly incomes (illustrative, in ₹ thousands): Country A: 9, 10, 10, 11, 10. Country B: 2, 3, 3, 2, 40. Find average incomes. Where would you rather live?

Solution: Both averages = 50 ÷ 5 = 10. But in A incomes are equally spread, while in B four people are poor and one is very rich. Most people would prefer A. Averages are useful for comparison but hide the distribution of income.

5. Beyond Income: Health, Education and Public Facilities

Money in the pocket cannot buy everything. A family with a good income still cannot buy a pollution-free environment, protection from infectious diseases, or a good school if none exists nearby. Many such things are best provided collectively through public facilities — government hospitals, schools, clean drinking water, sanitation, public transport and the public distribution system (PDS) for food grains.

For this reason, two states with similar per capita income can have very different levels of well-being. Kerala, for instance, has for many years been noted for low infant mortality and high literacy because of strong investment in basic health and education, even though its per capita income was not the highest. Some states with higher incomes have done less well on these indicators.

Important indicators
  • Infant Mortality Rate (IMR): the number of children who die before the age of one year, per 1000 live births in that year.
  • Literacy Rate: the proportion of literate population in the 7 years and above age group.
  • Net Attendance Ratio: the total number of children of age group 14–15 years attending school as a percentage of total children in that age group.
  • Body Mass Index (BMI): weight (kg) ÷ height² (m²); used to check under-nutrition — a BMI below 18.5 indicates undernourishment in adults.
Income Health Education HumanDevelopment Public facilities support health and education
Development needs more than income: the Human Development Index combines income, health and education.

6. The Human Development Index

The Human Development Report, published by the United Nations Development Programme (UNDP), compares countries using the Human Development Index (HDI), which combines three dimensions:

DimensionIndicator used
A long and healthy lifeLife expectancy at birth
KnowledgeMean years of schooling (adults) and expected years of schooling (children)
A decent standard of livingGross national income per capita (adjusted for purchasing power)

Life expectancy at birth is the average expected length of life of a person at the time of birth. HDI shows that some countries with modest incomes (for example, Sri Lanka, which has long had strong health and education outcomes) rank well on human development, while some richer countries rank lower than their income would suggest. India's neighbours offer interesting comparisons, which you will study in more detail in Class 11.

7. Sustainability of Development

Even if a country is developed today, can it remain so? Sustainable development means meeting the needs of the present without compromising the ability of future generations to meet their own needs.

  • Groundwater: it is a renewable resource only if extraction does not exceed recharge by rain. In many parts of India, groundwater is being over-used, and water tables are falling; if this continues, these areas may face serious shortages.
  • Non-renewable resources: crude oil, coal and minerals are fixed stocks that get exhausted with use. A country dependent on imported crude oil also faces risks when world oil prices rise.
  • Environment: pollution and degradation cross state and national borders. Climate change shows that environmental problems are global, and solutions need cooperation.

Scientists, economists, philosophers and social scientists all work together on the question of sustainability. Development that destroys the environment is not real development.

8. Case Studies and Solved Problems

Case 1 — Dam: development for whom?

A dam will supply irrigation and electricity to cities and farms downstream, but will submerge 40 villages. Discuss.

Answer: Beneficiaries see development; displaced villagers lose land, homes and livelihoods. A fair approach requires proper rehabilitation, compensation, consultation, and comparing alternatives (smaller dams, watershed development). The case shows that development goals can conflict.

Case 2 — Two states

State X has higher per capita income than State Y, but State Y has lower IMR and higher literacy. Which is "more developed"?

Answer: By income alone, X. But by human development, Y may be ahead because of better health and education, often due to public facilities. A complete judgement uses several indicators, not one.

Case 3 — Computing BMI

A student weighs 45 kg and is 1.6 m tall. Is the student undernourished (adult cut-off 18.5)?

Answer: BMI = 45 ÷ (1.6 × 1.6) = 45 ÷ 2.56 ≈ 17.6 — below 18.5, indicating under-nutrition by the adult standard (for children, age-specific charts are used).

9. Master Table: Key Terms and Formulas

TermMeaning / formula
National incomeTotal income of all residents of a country
Per capita incomeNational income ÷ population
Infant Mortality RateDeaths under 1 year per 1000 live births
Literacy rateLiterate population aged 7+ ÷ total population aged 7+ × 100
Net Attendance RatioChildren aged 14–15 in school ÷ all children aged 14–15 × 100
BMIWeight (kg) ÷ height² (m²)
HDIComposite of life expectancy, education and per capita income
Sustainable developmentMeeting present needs without harming future generations' ability to meet theirs

10. Master Summary Table

MeasureStrengthLimitation
Total national incomeSize of the economyIgnores population
Per capita incomeAllows comparison of countriesHides inequality; ignores non-material goals
IMR, literacy, attendanceShow real well-beingEach covers only one aspect
HDICombines income, health, educationLeaves out environment, freedom, equality
SustainabilityLooks to the futureHard to measure precisely

11. Mind Map

Development
Goals
  • Different, conflicting
  • Material + non-material
Income
  • Per capita income
  • World Bank groups
Beyond income
  • IMR, literacy, NAR
  • HDI, public facilities
Sustainability
  • Groundwater, oil
  • Future generations

12. Tips and Tricks

Smart ideas
  • For "conflicting goals" questions, always give one group that gains and one that loses.
  • When asked why per capita income is not enough, mention: inequality, non-material goals, public facilities, environment.
  • Remember HDI's three pillars as "Long life, Knowledge, Living standard".
Common mistakes
  • Defining IMR per 100 births — it is per 1000 live births.
  • Writing that the World Bank publishes HDI — it is published by UNDP.
  • Thinking groundwater is unlimited because it is renewable.

13. Important One-liners

  • Different persons can have different and conflicting development goals.
  • Per capita income = total income ÷ population.
  • Averages are useful for comparison but hide disparities.
  • Public facilities such as health care and schools are often best provided collectively.
  • HDI is published by UNDP in the Human Development Report.
  • Sustainable development protects the interests of future generations.
  • India is classified as a lower middle-income country by the World Bank.

14. Exam-pattern Questions with Detailed Answers

Q1Easy

The Human Development Report is published by:

  1. World Bank
  2. UNDP
  3. WTO
  4. IMF
Show answer

The United Nations Development Programme publishes the Human Development Report and HDI.

Answer: (B) UNDP

Q2Easy

Define Infant Mortality Rate.

Show answer

The number of children who die before completing one year of age, per 1000 live births in a year.

Answer: Deaths under age 1 per 1000 live births

Q3Easy

A country has national income of ₹50,000 crore and population of 5 crore. Find per capita income.

Show answer

50,000 crore ÷ 5 crore = ₹10,000.

Answer: ₹10,000

Q4Medium

"Different persons can have different and conflicting development goals." Explain with an example.

Show answer

Industrialists may want more dams to get electricity, but tribal people living there may lose their homes and livelihoods. Similarly, a factory may bring jobs to some but pollution to people living nearby. So development for one group may mean loss for another.

Answer: Goals depend on people's situation and may conflict, e.g. dams and displacement

Q5Medium

Why is per capita income not a complete indicator of development?

Show answer

It is an average and hides inequality; it ignores non-material goals like security, freedom and respect; it does not show access to public facilities such as health and education; and it says nothing about environmental sustainability.

Answer: Hides inequality and ignores non-income aspects of well-being

Q6Medium

Why are public facilities important for development? Give two examples.

Show answer

Some goods are cheaper and more effective when provided collectively — no individual can buy a pollution-free environment or ensure a whole village is free from disease. Examples: government hospitals and schools; the public distribution system providing food grains at fair prices; clean drinking water supply.

Answer: They provide essential services all can use, irrespective of income

Q7Medium

What is the Net Attendance Ratio? Why is it a useful indicator?

Show answer

It is the number of children aged 14–15 attending school as a percentage of all children of that age. It shows how many children actually continue schooling, not just enrolment, and reflects access to education.

Answer: % of 14–15-year-olds attending school; shows real educational access

Q8Medium

What are the three components of the HDI?

Show answer

Health (life expectancy at birth), education (mean and expected years of schooling) and standard of living (gross national income per capita).

Answer: Life expectancy, education, per capita income

Q9Hard

Explain why sustainability is important for development, with the example of groundwater.

Show answer

Groundwater is renewable only when the rate of use does not exceed recharge by rain. In many regions extraction for irrigation and cities exceeds recharge, lowering water tables. If this continues, future generations will face water shortages and farm output may fall. So development that ignores sustainability may reverse itself; resource use must be planned for the long term.

Answer: Over-use today threatens tomorrow's development

Q10Hard

Two countries have the same average income. Why might one be preferred to the other? Illustrate with numbers.

Show answer

Illustrative: A has incomes 9, 10, 10, 11, 10; B has 2, 3, 3, 2, 40. Both average 10, but B is highly unequal: four citizens are poor. Most people would prefer A because income is more equally distributed and fewer people are deprived.

Answer: Equal distribution matters; averages hide inequality

Q11Hard

"Money cannot buy all the goods and services needed to live well." Do you agree? Give three examples.

Show answer

Agree. Money cannot easily buy: a pollution-free environment; protection from infectious diseases unless the whole community is protected; a safe neighbourhood; unadulterated medicines; or good schools if none exist locally. These require collective action and public provision.

Answer: Agree — environment, public health, safety need collective action

Q12Hard

Suggest a balanced set of indicators to judge a state's development, and justify.

Show answer

Per capita income (material standard), IMR and life expectancy (health), literacy and net attendance ratio (education), access to drinking water, sanitation and electricity (public facilities), inequality and women's participation (fairness), and groundwater or forest cover trends (sustainability). Together these give a fuller picture than income alone.

Answer: Combine income, health, education, facilities, equity and sustainability indicators

15. Quick Revision Summary

Revise in 2 minutes
  • Development goals differ across people and may conflict.
  • Income matters, but so do freedom, security, equality and respect.
  • Per capita income compares countries but hides inequality.
  • IMR, literacy rate, net attendance ratio and HDI measure human well-being.
  • Public facilities make a big difference to health and education.
  • Sustainable development protects resources like groundwater and oil for future generations.