Development: The Economic and the Non-Economic Perspective.

As active members of society, we always tend to analyze economic problems and provide our own socio-political stance as a solution to the problem. In fact, we are always running around in circles – companies and corporates are desperately trying to perfect the numbers of the Gross Domestic Product (GDP) while we, as individuals, are constantly making efforts to grow as human beings. However, we almost always forget that the root cause of our incessant economic debates is the word ‘development’.

‘Development’ is a word that lacks a universally accepted definition. Different people interpret the word differently. For some, it may have an economic connotation, while others may think that development means holistic growth. In fact, there have been several debates all over the world about whether to measure a nation’s development through the gross domestic product which is basically the economic output of a nation, or by something known as the Happiness Index (synonymous with Human Development Index) that measures the overall progress of a country that includes the happiness of the community.

Long ago, when international trade and relations were nascent, the term ‘development’ was used to describe projects and ventures of an economic nature. Development, at that time, translated into gains that were monetary or in movable or immovable property. Therefore, when the wealthy nations of the West colonized the countries of the East, it was development. It was only after the Second World War when an entire race was lost, several million people were left dead and countries collapsed overnight, it was decided that international development should have a completely different face.

Such a decision changed the entire perception of the world. Now, development encompasses governance, healthcare, gender equality, human rights, sustainable development, education, innovation and the like along with the economic criterion. West Indian economist and Nobel Prize winner Arthur Lewis defined development as the enlargement of the range of people’s choices. The United Nations Development Programme’s Human Development Reports followed him and used the same definition. Amartya Sen’s definition of development is extremely rational. He talks of development as ‘opportunities’ and ‘capabilities’ instead of satisfaction, happiness and commodities. His approach looks at the potentiality of a nation or a community of people instead of the actuality.

This new definition of development is far more rational than the modernist definition. After all, development is not only a reflection of monetary gains; it is the way how a country grows and matures. However, the well-being of countries is still measured by the economic output or GDP. And, what GDP lacks is that the measurement is not complete. Its value as an indicator of standard of living is extremely limited.  GDP does not take into account the disparity of income between the rich and the poor – the rich continue to become wealthy, and the poor continue to become poorer. GDP excludes activities that are not provided through the market, such as household production and volunteer or unpaid services. GDP ignores externalities like damage to the environment, and harm to human life.

Development is basically a perspective. Whether it is from an economic standpoint, or from a humanistic point of view, development means growth; it means the ability to mature and the potential to do something. And the point is perspectives change. As time passes, this current perspective about development will perhaps change and it will probably become a more concrete concept.

Deya Bhattacharya

Image Source: []