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Description
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Term
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That the three types of which are economic such as the financial crisis, natural such as the 2011 Japanese tsunami, and political such as the 2019 election defeat of Argentina President Macri
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External Shock
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A rapid flow of assets/money out of a country such as profits in firms in less developed countries being invested abroad where returns are higher
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Capital Flight
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Aid provided to less developed countries for economic, humanitarian, or political reasons, criticised for being too low, being lost to inefficiency and corruption, being tied to poorly selected projects (now less common), and for potentially increasing the less developed countries' exchange rate, reducing its competitiveness
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Official Development Assistance
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An initiative launched in 1995 and relaxed in 2005 to provide debt relief for heavily indebted poor countries, difficult to evaluate given the simultaneous reduction in debt-service levels in recent years
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Heavily Indebted Poor Countries (HIPC) Initiative
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The ratio of a bank's capital to its current liabilities and risk-weighted assets
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Capital Adequacy Ratio
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Where the interest rate is so low that any increase in the money supply will not be able to lower it further
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Liquidity Trap
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The banker to the government, performing a range of functions which may include issue of coins and banknotes, acting as banker to the commercial banks, and acting as regulator of the financial system
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Central Bank
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A repeating cycle of beneficial circumstances such as is suggested by Rostow's Stages of Economic Growth Model
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Virtuous Cycle of Development
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A fiscal deficit caused by spending and taxation decisions separate from the position of an economy in the economic cycle, not being linked to said cycle and thus able to exist at full employment
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Structural Deficit
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A process by which a decrease in government expenditure increases the ability of the private sector to invest by lowering the cost of borrowing (interest rates)
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Crowding In
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That a rise in which would reduce demand-pull inflation but increase cost-push inflation by raising the cost of firms' past borrowing
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Interest Rates
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One of the principal things affected by government expenditure alongside productivity and growth (education, infrastructure, etc.), public-private sector balance, equality, etc.
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Living Standards
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That virus and subsequent syndrome that has much harmed development in Sub-Saharan Africa by reducing productivity and increasing health expenditure
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HIV and AIDS
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That which is divided into four tiers, namely; very high human development (0.8 - 1.0), high human development (0.7 - 0.79), medium human development (0.55 - 0.69), and low human development (below 0 - 0.54)
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Human Development Index
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That which a reduction in government involvement may be, taking the form of privatisation, a reduction in or removal of subsidies or price controls, possibly incentivising increased efficiency and leading to increased competitiveness, or having a floating exchange rate instilling discipline causing a country to live within its means, thus incentivising efficiency
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Market Oriented Strategies for Development
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The ease with which an asset can be turned into money / the state of being able to conduct exchange with available money
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Liquidity
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A process whereby future cash flows are converted into marketable securities (financial assets) such as selling a stock of residential mortgages, allowing for a bank to hold fewer liquid assets, but also being vulnerable to asymmetric information
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Securitisation
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That an example of which in firms investing by using past profits is the interest rate that could have been earned by purchasing financial assets or saving
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Opportunity Cost
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An increase in the available of life sustaining goods and services, the expansion of people's ability to make economic and social choices free from exploitation, dependence, and ignorance, and the enhancement of material well-being and self esteem via higher incomes, more jobs, better education, and more attention to cultural and human values
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Economic Development
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That which appears on the money demand and supply curve where the downward sloping money demand curve meets the perfectly inelastic money supply curve
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Equilibrium Interest Rate
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