The branch of economics concerned with less developed countries. Its main difference from economics as applied to advanced economies is a need to attend more to problems such as lack of infrastructure - power systems, transport and communications, clean water supply, etc. There are also problems with low educational standards, population pressure, poor agricultural practices and soil erosion, underdeveloped financial institutions, and excessive reliance on single export products, making foreign exchange rates receipts very unreliable.
Development economics is a branch of economics that deals with the study of macroeconomic causes of long term economic growth, and microeconomics; Unlike classical economics, development economics incorporates social and political strategies to devise particular plans for development in third world countries.
Topics of Research
Development economics also includes topics such as Third World debt, and the functions of such organisations as the International Monetary Fund and World Bank. However, these measures are criticized as not measuring economic growth well enough, especially in countries where there is much economic activity that is not part of measured financial transactions (such as housekeeping and self-homebuilding), or where funding is not available for accurate measurements to be made publicly available for other economists to use in their studies (including private and institutional fraud, in some countries). Even though per-capita GDP as measured can make economic well-being appear smaller than it really is in some developing countries, the discrepancy could be still bigger in a developed country where people may perform outside of financial transactions an even higher-value service than housekeeping or homebuilding as gifts or in their own households, such as counseling, lifestyle coaching, a more valuable home decór service, and time management. More recent theories of Human Development have begun to see beyond purely financial measures of development, for example with measures such as medical care available, education, equality, and political freedom.
Recent developments
The most prominent contemporary development economist is perhaps the Nobel laureate Amartya Sen. Recent theories revolve around questions about what variables or inputs correlate or effect economic growth the most: elementary, secondary, or higher education, government policy stability, lack of trade barriers, fair court systems, available infrastructure, availability of medical care, prenatal care and clean water, ease of entry and exit into trade, and equality of income distribution (for example, as indicated by the Gini coefficient), and how to advise governments about macroeconomic policies, which include all policies that effect the economy. (2005), Pioneers of Development Economics: Great Economists on Development, Zed Books - the contributions of economists such as Marshall and Keynes, not normally considered development economists Gerald M. (eds, 2005), The New Development Economics: Post Washington Consensus Neoliberal Thinking, Zed Books Peter Griffiths (2003), The Economist's Tale: A Consultant Encounters Hunger and the World Bank, Zed Books World Institute for Development Economics Research Publications/Discussion Papers The Center for Global Development
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