Economics Assignment 1: Workshop Questions Analysis

This economics assignment addresses three workshop questions. The first question critically analyzes the Human Development Index (HDI) as a measure of economic and social well-being, providing examples where HDI is a good measure and where it is misleading. The second question examines the viewpoint on whether unemployment is a necessary evil, based on the provided article. The third question critically evaluates the statement that globalization has reduced poverty in developing economies, supporting the position with two valid examples and citations. The assignment demonstrates an understanding of economic concepts, critical analysis, and the ability to support arguments with evidence.

WORKSHOP QUESTIONS 1
WORKSHOP QUESTIONS
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WORKSHOP QUESTIONS 2
Workshop Question 1
The UNDP describes development on the basis of three essentials, which includes the
ability for a country’s population to have long and healthy life, have a decent standard of living
and quality education (Frugoli et al, 2015, p.370). Through the Human Development Index, a
country’s overall well-being can, therefore, be easily measured. It’s a social measurement as it
takes into consideration the above three essentials through education; which entails adult literacy
rate and the average schooling years, healthcare level within a country as denoted by the life
expectancy and the economic factor of the GDP. HDI measures each of the three essentials in a
scale of 0 to 1, where 1 is the best while 0 is the worst. HDI is, therefore, a crucial measure of
economic and social well-being in a country because it covers both economic and social factors
hence reducing anomalies (Howard and Chambers, 2016, p.560).
The Human Development Index measures the success rate of a country through the
dimensions of wealth, education, and longevity. Prior to its invention as a crucial measure of
economic development, economic growth was the only factor used to measure success rate of an
economy, which did not incorporate personal aspects of development like the health status of
people and the education factor. In a country like Australia whose HDI is 0.93, it is useful
because it depicts the overall well-being of the country’s economy and its people in line with its
economic growth (Maridal et al, 2018, p.9). Because life expectancy and education are crucial
determinants of living standards in a country, and hence when those factors are measured plus
the economic growth, HDI provides some metrics to measure the development of countries.
In a country like Argentina which has a high HDI, its economic growth as presented by
its GDP does not match with the HDI. This is a clear indication that the HDI of Argentina is

WORKSHOP QUESTIONS 3
misleading and may make the country to assume being on the right track when the reality is
totally different (Sirgy, Estes and Selian, 2017, p.140). For that matter, basing the argument of
the economic well-being of a country on the HDI grounds should be done with great care
because it might be misleading.
Workshop Question 2
Based on the article “Unemployment is a necessary evil?” unemployment is truly a
necessary evil. First of all, it is evil because of its consequences in the current economic times. I
mean, how many times have we heard of people from different parts of the world die out of
hunger, got life imprisonment because they attempted to steal as a result of poverty and lack of
basics? Unemployment, however, plays a major role in ensuring that employees are paid well. It
can, therefore, be seen as a necessary evil.
When unemployment is perceived from an economic point of view, evil as it may appear
from a human point of view; it is necessary because the population of employable people always
surpasses that of the available employment opportunities and that makes it hard to have full
employment in any economy regardless of how developed it is. Assuming that all people are
absorbed in the job market, the available resources will be divided among all the employees and
that will mean each employer will be receiving very little in terms of salaries or wages. In
consideration to business organizations, they will be making very little in terms of returns and
hence there will be no growth at all.
Full employment in an economy will therefore mean low income to employees and which
in turn will imply low standards of living. this is in consideration to the fact that a country is said
to be on the right track when citizens have high standards of living. Full employment will,

WORKSHOP QUESTIONS 4
therefore, deter economic growth because most of the people although employed will be leading
very miserable lives where high education and quality healthcare will be unaffordable.
Unemployment can, therefore, be seen as a necessary evil because organizations can afford to
expand and compensate their employees handsomely to enable them affords high standards of
living like quality education as well as healthcare.
Workshop question 3
Beyond any reasonable doubt, Globalization has played an important role in reducing
poverty in developing economies. This has come as a result of various reasons which include
mechanization, industrialization and technological advancement. In consideration to
mechanization, a country likes the Democratic Republic of Congo which is among the richest
country in the whole world in terms of minerals lagged behind because they lacked the necessary
machinery to exploit their minerals (Yapa, 2017, p.20). However, in the dawn of globalization,
this country has been able to trade with highly mechanized countries like Germany and Japan to
outsource skills and machines which have led to the exploitation of the minerals to facilitate
economic growth within the country. This has led to employment creation in the country to
enable its citizens have high standards of living and above the poverty level which was the case
before.
Kenya on the other hand, where production technology and machines were unfamiliar
before the dawn of globalization, farmers of pyrethrum and wheat could not operate in large
scales (Makasi and Govender, 2015, p.341). This led to low incomes which made them lead
some very miserable lives below the poverty level. However, in the dawn of globalization,
machines like combined harvesters, plowing tractors, use of insecticides and pesticides came into

WORKSHOP QUESTIONS 5
limelight leading to increased production of some of those cash crops. Farmers have henceforth
begun to realize high and guaranteed returns from their hard work and improved their living
standards beyond the poverty level. On a country level, DRC and Kenya have been able to
increase their exports as a result of mechanization which has translated to higher incomes and
overall improvement in the standards of living within the two countries (Logan, 2017, p.35).
In conclusion, globalization has played a critical role to reduce poverty in most of the
developing economies following the exchange between the developed countries and the
developing ones in terms of technology of production, mechanization, and industrialization
(Alvarez, Barney, and Newman, 2015, p.23). Through the technological exchange, developing
economies have been able to become more productive to sustain their local economies and
improving their standards of living. This is contrary to the case before globalization where most
of the developing economies produced locally and hence realized low yields.
References
Alvarez, S.A., Barney, J.B. and Newman, A.M., 2015. The poverty problem and the
industrialization solution. Asia Pacific Journal of Management, 32(1), pp.23-37.
Frugoli, P.A., Almeida, C.M.V.B., Agostinho, F., Giannetti, B.F. and Huisingh, D., 2015. Can
measures of well-being and progress help societies to achieve sustainable development?. Journal
of Cleaner Production, 90, pp.370-380.
Howard, C. and Chambers, A., 2016. The challenge of quantifying national well-being: lessons
from the Measures of Australia's Progress initiative. Policy Studies, 37(6), pp.551-567.

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Logan, B.I., 2017. Globalization, the Third World state, and poverty-alleviation in the twenty-
first century. Ecological Economics, 149, pp.12-112.Routledge.
Maridal, J.H., Palich, L., Morgan, G., Gardner, S., McKinney, J. and Bolbocean, C., 2018.
Wellbeing Indices: A Comprehensive Inventory of Standards and a Review of Current
Comparative Measures. Ecological Economics, 149, pp.1-11.
Makasi, A. and Govender, K., 2015. Globalization and sustainable development: a conceptual
model. mediterranean Journal of social sciences, 6(4), p.341.
Sirgy, M.J., Estes, R.J. and Selian, A.N., 2017. How We Measure Well-Being: The Data Behind
the History of Well-Being. In The Pursuit of Human Well-Being (pp. 135-157). Springer, Cham.
Yapa, L., 2017. Globalization and poverty: From a poststructural perspective. In Globalization,
the third world state and poverty-alleviation in the twenty-first century (pp. 15-29). Routledge.