New/Modern Economic View of Development:

In strictly economic terms, economic development represents a situation whereby the capacity of an economy changes from long term static situation to generate and sustain an annual increase in GNP at the rates of 5% to 7% and even more. Again, economic development was associated with rise in per capita GNP which would occur if growth of GNP is more than growth of population.

However, in these two approaches, commonly known as traditional measures of economic development, the concepts of real GNP and real GNP per capita were employed.

Thus during 1950 and 1960 economic development was evaluated in terms of planned alteration of structure of production and employment so that the share of agri. in total output could decrease and that of industry and services could increase. Therefore, the 'Development Strategies' stressed upon rapid industrialization at the expense of agri. and rural development. Finally, these traditional measures of economic development were supplemented by non-economic, Social Indicators: gains in literacy, schooling, health conditions and services and provision of water supply and housing etc.

But the development experience of 1950s and 1960s in case of UDCs was not encouraging. They realized their growth targets but the levels of living of the masses of people remained for the most part unchanged. This showed that something was very wrong with this traditional and narrower definition of economic development. Then a slogan became popular, "The dethronement of GNP" and efforts be made to attack directly on

widespread absolute poverty, increasing inequitable income distributions and rising unemployment.

In short, after 1970s the economists and policy makers are redefining economic development in terms of elimination of poverty, inequality and unemployment within the context of a growing economy. This new approach to development was given the name of 'Re-distribution from Growth'.

In this respect Prof. Dudly Seers writes:

"Economic development will be possible if we see (i) What has been happening to poverty? (ii) What has been happening to unemployment? (iii) What has been happening to inequality? If all three have declined then it would represent development for the country concerned. If one or two of these central problems, have been growing worse especially if all three have, it would be strange to call the result 'development' even if per capita income doubled".

Thus the UDCs in 1960s and in 1970s developed on the basis of "Growth Criteria', but they did not on the basis of poverty, equably and employment criteria. The situation in 1980s worsened further as GNP growth rates turned negative for many UDCs and govts. faced with mounting foreign debt problems, were forced to cut back the already limited and poor social services.

It is told that development and under development are not just an economic problems rather they are very crucial issues of life. More than 3 billion people of the world are living in underdevelopment, misery and poverty In this respect, Prof. Denis Govlet Writes:

"Underdevelopment is shocking; the squalor, diseases, unnecessary deaths, and hopelessness of it all. Chronic poverty is a cruel kind of hell, and one can not understand how cruel that hell is merely by gazing upon poverty as an object".

World Bank in its 1991 'World Development Report' asserted on the following:

"The challenge of development is to improve the quality of life. Especially in the World's poorest countries a better quality of life generally calls for higher incomes, but it involves much more. It encompasses as ends in themselves better education, higher standards of health and nutrition, less poverty, a cleaner environment, more equality of opportunity, greater individual freedom, and a richer cultural life".

Therefore the present day economists are of the view that:

"Development must be conceived of as a multidimensional process which could involve major changes in social structures, popular attitudes, and national institutions, as well as the acceleration of economic growth, the reduction in inequality, and the eradication of poverty. Development, in its essence, must represent the whole gamut of change whereby unsatisfactory life is replaced by a materially and spiritually better life".

Therefore, for the sake of good socio-economic life Prof. Goulet and others present three basic components or core values of economic development.

Three Core Values/Components of Development:

These core values are consisted of (i) Sustenance, (ii) Self - Esteem, (iii) Freedom. They relate to fundamental human needs of all the societies at all the times.

It is also known as "the ability to meet basic needs".  All the persons have certain basic needs which are necessary for the survival. They consist of food, shelter, health and protection. If any one of them is missing or in short supply in any economy it would represent the state of under-development. Therefore, the purpose of economic development and economic activity is to make the possible efforts whereby the helplessness and misery of the people which arises due to lack of food, shelter, health and protection could be removed. Therefore, if due to economic development the quality of life is improved, it would really represent economic development. Therefore, if per capita income increases, absolute poverty is eliminated, greater employment opportunities are created and income inequalities are lessened, such all would constitute the , necessary though not the sufficient condition of economic development.

(ii) Self-Esteem, i.e., to be a Person:

A second universal component of the good life is a self-esteem, a sense of worth and self-respect. It means that the other people could not use him for their own ends. It also means that each person should be given his due respect and due right. Each person is desirous of his prestige, identity and recognition, though all f such values differ from country to country and from society to society. It is being observed now a days that when the process of economic development starts in a country the inequalities in the distribution of income increase. Because of such inequality the rich class considers itself superior to the poor. In this way, the poor segment of the society suffers from inferiority complex which leads to affect their efficiency.

Therefore, economic development should aim at removing such like unhealthy social and economic situation. When the man will be considered man and he is given due place he will be able to contribute well to economic development. Moreover, in addition to such domestic situation, such an atmosphere should be created at international level that both rich and the poor countries could stand side by side. If despite remarkable growth attained by UDCs they are looked down upon by the DCs, it will not represent economic growth.

(iii) Freedom from Servitude, i.e., to be Able to Choose:

The third universal value required for economic development is concerned with human freedom. By freedom it means the emancipation from alienating material conditions of life and from social servitude to nature, ignorance, other people, misery, institutions and dogmatic beliefs. As Arthur Lewis says:

"Advantage of economic growth is not that wealth increases happiness, but that it increases the range of human choice".

Wealth on the basis of economic growth, enables the people to have a greater control over goods and services than they would have if they remained poor. It also gives them the freedom to choose greater leisure. But as a result of such all social, ethical and spiritual life of the people is shattered, such type of economic development will be of no use. Therefore, due to economic growth there should be an uplift in social, ethical and spiritual life of the people.

The concept of human freedom should also encompass various components of political freedom like personal security, the rule of law, freedom of expression, political participation, and equality of opportunity. However, some of notable economic success stories of 1970s and 1980s regarding Turkey, Indonesia, Chile, South Korea, Singapore, Thailand, Saudi Arabia and China did not score very high on the 1991, Human Freedom Index complied by United Nations Development Program (UNDP).

Three Objects of Economic Development:

From the above discussion we conclude that economic development is not only a physical phenomenon, but it also represents a state of affairs where a society is in a position to have the means of a better life through some combination of social, economic and institutional changes. Regarding a better life, following requirements, known as objectives of development, must be fulfilled.

(i) Not only the availability of basic needs like food, shelter, health and protection be made sure, but their distribution should also be widened.

(ii) To improve the standards of living in addition to higher incomes, more jobs, better education and greater attention to cultural and humanistic values be given. They will not only increase material values, but they will also generate individual and national self-esteem.

(iii) The economic and social range available to the people and nations should expand. They should be freed from miseries, illiteracy, servitude, dependence and narrow mindedness etc. not only in relation to other people but also to other nations.