Economists determine a country's level of economic development using indicators like GNP, per capita income, industrialization, and social indicators. Development progresses through stages from hunting and gathering to pastoral/nomadic, agricultural, handicraft, and industrial. The Philippines saw development from a pre-Spanish agricultural economy to growth under American rule in agriculture and exports, then postwar reconstruction and development planning. Social indicators also reflect development levels.

1. Penn T.Larena,CPS,MPA
Economic Development, Concepts,
Theories and Indication

2. Learning Outcomes
• Discover the different stage of
Development
• How do Economists determine the level of
Economic development of a country
• Social Indicators in economic development

3. What is Economic
development?
• The Concept of Development
• Development is the passage from a lower stage to a
higher stage.
• Economics development is the modernization of
institutions ,whether economic or non-economic such as
governments, cities, countries, ways of thinking not only
to produce efficiently but to consume rationally and live
better.

4. Classification of
Countries
• Discussions about international economic development
have resulted in the division of countries as to developed
and developing, the haves and the have nots, the Third
World, the Group of 77 and the North and South

5. Stages of Economic
Development
• Economists have long regarded economic development as
proceeding according to a timetable. Economic
development may be divided into different stages just as
man goes through various stages of development.

6. Stages of Economic
Development
• Hunting and Fishing Stage
In this condition of life much the greater part or all of the food-
supply is obtained from the products of the forest and stream
without the exercise of care or cultivation. As a rule, little
provision is made for the future, the stores laid up for periods of
being less in proportion and less providently cared for than those
of the squirrel or the ant. As the life of such people is generally
migratory, they do not build permanent residences nor establish
durable social institutions. They are with out history, an existence
of ceaseless change and struggle for the necessaries of
subsistence soon extinguishing the memories of the past. Their
arts are confined to those most essential to the pursuit of game
and self defence.

7. Stages of Economic
Development
• Pastoral Stage
The Pastoral Stage. General Characterization. ... When
hunting tribes cease to depend for food solely upon the
killing or capture of animals, and turn to the art of taming
and breeding them, such tribes are entering upon the second
great era of economic progress, which we have called
the pastoral stage.

8. Stages of Economic
Development
• Agriculture Stage
Agricultural production increase in the
traditional phase through increase in the area under
cultivation. ... The extra production helped the industrial
sector which helped the agricultural sector in term through
providing improved agriculture inputs

9. Stages of Economic
Development
• Handicraft Stage
This is the beginning stage of the evolution
of the industry. The process of production
was simple and many machines were not
used. They used local materials to produce
handicraft products.

10. Stages of Economic
Development
• Industrial Stage
The third stage of the demographic
transition model, characterized by falling
birth rates that close the gap with falling
death rates and reduce the rate of population
growth. Compare pre-industrial stage; post-
industrial stage; transitional stage.

11. How do Economists determine the level
of Economic development of a country
• GNP- Gross National Product
• Per Capita Income
• Industrialization
• Social Indicators of Development
• Health
• Water Supply
• Sanitation
• Productivity of Labour
• Rate of Population Growth
• Education
• Level of Unemployment and Underemployment

12. GNP- Gross National Product
• GNP is the total value expressed in terms of money of all
goods and services produced in a given period of time,
usually one year.The GNPS of developing countries are
lower than those of developed countries .The average
growth rate of the GNP of developing countries is 2.5 per
cent while that of the developed countries is 4.6per cent.

13. Per Capita Income
• Per capita income refers to money
each person would spend if the
national income was equally divided
among the population. Per capita
income is lower in developing
countries than that in developed
countries.

14. Industrialization
• INDUSTRIALIZATION is a term
which covers the growth of modern
industry in a society basically
agricultural .Including here are the
accompanying conditions ,changes
and problems which are economic,
political and social in nature.

15. Three stages of
Industrialization
• Processing of primary products of raw materials
• Transformation of raw materials into finished
products for satisfaction of human wants
• Manufacturing of machines and other heavy
capital equipment to increase the efficiency of
processes of production

16. Social Indicators of
development
•Health
•Life expectancy refers to the
average number of years in
which a citizen of a country is
expected to live.

17. Social Indicators of
development
• Water Supply
• The percentage of the population
which uses potable water is another
index of economic development.
When a majority of population uses
water works system ,then the country
& world

18. Social Indicators of
development
• Sanitation
• The percentage of population
which maintains sanitary facilities
will determine the percentage of
infant morality and life
expectancy of people.

19. Social Indicators of
development
• Productivity of Labor
The Labor force in developing countries is
not as productive as labour in developed
countries.The labor force in a developing
country often does not possess necessary
knowledge and skills required of a particular
job in industry.

20. Social Indicators of
development
• Rate of Population Growth
Developing countries have a higher rate of
population growth for developing countries is 2.5
per cent per year while that of developed countries
is only 1 per cent.With high birth rate in
developing countries ,about one half of the
population is below 15 years old.Only 25 per cent
of the population in developed countries is below
15 years old.

21. Social Indicators of
development
• Education
Literacy rate is another measure used in
determining the the level of economic
developing countries have a literacy rate of
only 10 to 15 per cent of the population
while developed countries have a record of
97 per cent literacy of the population

22. Social Indicators of
development
• Levels of Unemployment and
Underemployment
Unemployment is the condition where there
are no available jobs for people who are able
and willing to work .In developing countries
about 10 to 25 per cent of urban labor is
unemployed .Among 15 to 24 age group
about 20 to 30 per cent are unemployed.

23. History of Economic
Development in the
Philippines
• Pre-Spanish Period
A agricultural economy since pre –Spanish times.
The kaingin system was being practiced by the
early Filipinos.
This method involved burning patches of land for
planting of crops ,Livestock raising ,logging,
weaving and fishing.

24. History of Economic
Development in the
Philippines
• Spanish Regime
The Spaniards neglected economic
development due to their preoccupation with
the galleon trade .Only Governor Basco
introduced economic reforms in the
country.The missionaries were greatly
responsible for introducing new industries,
plants and animals in the country.

25. History of Economic Development in
the Philippines
• American Rule
The coming of the Americans bolstered the
development of Agriculture.Crops such as rice
,corn,coconut, abaca,sugar and Tobacco were
cultivated on a large –scale basis.There was rapid
growth in trade and world output with opening of
the American market on a preferential basis to
Philippine exports.Sugar ,tobacco,abaca and coffee
became well –established export industry.Full free
trade with the United States ensued until the
1930s.

26. History of Economic Development in the
Philippines
• Commonwealth Period
Conscious economic restructuring was
considered by the government in preparation
for independence. The National Economic
Council was created as the highest economic
policy planning organ in the government.

27. History of Economic Development
in the Philippines
• Period of the Second Republic
Reconstruction of the war-torn country was
attended to during the early part of the Second
Republic .The Central Bank was established to take
charge of allocating foreign exchange.Development
plans were drawn up proposing comprehensive
public and private sector program.A period of
special relations was established between the
Filipino and Americans.

28. History of Economic Development
in the Philippines
• Period of the New Society
• GDP growth slows to 6.2%
• The Philippine economy grew at a slower pace in 2018, failing to hit
the government’s target but still among the fastest in Asia, the National
Economic and Development Authority (NEDA) reported yesterday.
• In the fourth quarter of 2018, gross domestic product (GDP) growth
registered at 6.1 per cent, weaker than the 6.5 per cent pace in the same
period in 2017 and tracking the six percent growth rate in the third
quarter of 2018.
• This brings the full-year economic expansion to 6.2 percent, slower
than the 6.7 percent registered in 2017 and below the government’s
downward revised target range of 6.5 to 6.9 percent for the year.

29. Social Indicators
• Literacy
• Infant Mortality
• Medical Care
• Food Supply
• Dependence on Agriculture
• Status of Employment