Characteristics of Developing Countries
These countries are in a developing phase with different economic dimensions, such as per capita income, GDP per capita, HDI, living standards, fulfillment of basic necessities, or human development index (HDI). According to the UN, a developing country is one that has a low standard of living, low industrial base, and moderate or low human development index.
These countries are in a developing phase with different economic dimensions, such as per capita income, GDP per capita, HDI, living standards, fulfillment of basic necessities, or human development index (HDI). According to the UN, a developing country is one that has a low standard of living, low industrial base, and moderate or low human development index. Accordingly, developing countries are nations that have a lower per capita income than developed nations such as the USA, Germany and China. We will now discuss the different characteristics of developing nations around the globe.
Common characteristics of developing countries include high levels of poverty, high living standards, lower incomes, illiteracy and unemployment, underutilization, socio-political volatility, poor governance, uncertainty and vulnerability, as well as low access to financing.
Sometimes, developing countries are also called underdeveloped or poor countries, third world countries, less developed countries, or backward nations. These countries are eager to develop their economy by making use of their resources. They are however lagging behind in terms of stability and development. These countries are all vulnerable and uncertain in different ways, but they all face the same degree of vulnerability and are struggling to develop.
Below are some common characteristics of developing countries.
The Major Characteristics Of Developing Countries:
Real Income Per Capita Low
Comparing to developed countries, the per capita income in developing countries is much lower than that of developed countries. This means that the per capita income, or average income, of developing countries is very low and is not enough to save or invest. Low per capita incomes in developing countries lead to low savings and investment, which ultimately leads to poverty. This is one the most serious problems that underdeveloped countries face.
Many people in poor countries have suffered from poverty. They cannot meet their basic needs. Low per capita incomes in developing countries are another sign of poverty. The problem of poverty in the underdeveloped world is characterized by illiteracy, lack of fulfillment of basic necessities, unemployment, and a lack of access to other socio-economic opportunities and participation, other than low per capita income.
Rapid Population Growth
The population of developing countries is either larger or has a higher growth rate. Higher population growth rates in developing countries are due to many factors. These countries have a higher infant and child mortality rate, which makes it more difficult for people to be insured and to have more children. There are no family planning options or education. Sex education is not available. People believe that more children equals more income. People in developing countries are encouraged to have more children. This can also be supported by the belief that there is conservatism in these countries.
The Problem of Underemployment and Unemployment
Other major problems that are common in developing and underdeveloped countries include unemployment and underemployment. Due to a high dependency on agriculture, low industrialization, poor utilization of natural resources, and a lack of workforce planning, the problem of unemployment and underemployment is common in developing countries. Underemployment in developing countries is more severe than unemployment. Because there are no alternative jobs, people feel compelled into low-paying jobs. In these countries, the problem of underemployment is particularly prevalent in rural and backward areas.
Excessive dependence on agriculture
In developing countries, the majority of people are involved in agriculture, particularly in rural areas. In these countries, agriculture is the sole source of income. In poor countries, this sector also contributes more to the gross domestic product. More than 70% of South Asian countries' population are directly or indirectly involved in agriculture.
Innovative technology is an important factor in the development of a nation. In developing countries, technological use is low. Also, the technology that is being used is often outdated. This results in high production costs and high capital-output ratios in the underdeveloped countries. The high capital-output and high labor-output rates and low wages result in low input productivity, which reduces the country's gross domestic product. Among the main causes of technological backwardness are illiteracy, inadequate education, lack skill development programs and a lack of capital to invest in innovative techniques.
Duality, or dualism, refers to the existence of two distinct sectors within an economy. These include the modern or advanced sector as well as the traditional or backward sector. Dualism is a hallmark of many developing countries. The urban sectors are more advanced than the rural ones, and there are many problems with rural areas such as a lack economic and social facilities. Rural people are heavily involved in agriculture, while urban residents are more likely to be in the service or industrial sectors of the economy.
Infrastructures are lacking
Development of infrastructure, such as transportation, communication and irrigation, power, financial institutions, overheads, etc. In developing countries, infrastructure is often not well-developed. Also, the infrastructure that is well-developed is not managed and distributed in an efficient and equitable manner. This poses a threat to the development of these nations.
The productivity of factors in developing countries is also low. This is because there are not enough capital and managerial skills to get innovative technologies and policies, and manage them effectively. Insufficient health care, malnutrition, poor work-life balance, and living in unhygienic environments are all factors that contribute to lower productivity. These are some of the factors that contribute to lower productivity in developing countries.
High Consumption, Low Savings
Income is low in developing countries. This causes high consumption, low savings, and low capital formation. These people are facing poverty and finding it difficult to meet their most basic needs. They will have to spend more of their income on consumer goods. A higher percentage of income earned is consumed, which results in lower savings rates and capital formation. These countries will ultimately rely on loans and foreign aid that has limited utility to expand their economy.
These points are indicative of the characteristics and state of developing countries. Other than the above-described points, there is an excessive dependence on developed countries, inadequate provision of social services such as education facilities, health facilities and sanitation, and dependence upon primary exports due lack of development and expansion in secondary and tertiary economic sectors. These are some of the major characteristics of developing nations around the globe. These countries are more affected by the economic crisis that has resulted from the 2020 coronavirus. These countries face additional challenges in terms of development.