Economic Development, Growth, and the UNDP's HDI Goals

Defining Economic Development

Economic development is the term used to refer to the "development of the economic wealth of countries or regions for the well-being of their inhabitants." Economic development is evidenced when an increase in living standards is sustainable, which "implies increased per capita income, better education and health as well as environmental protection" (Wikipedia, 2006). The Economic Developers Association defines economic development as "the process of developing and maintaining suitable economic, social and political environments, in which balanced growth may be realized, increasing the wealth of the community" (Economic Developers Association, 2003).

Economic development is not static but is a "process." Within this process are a "series of steps that build on each other to create a desired product or outcome." Economic growth is determined by the community or region and is influenced in its successful implementation by two key factors: (1) available resources and (2) the desires of the community or region. Because economic development is a process, periodic evaluation is required. Such evaluation allows the adjustments necessary at each stage to be made, enabling better use of resources and more effective goal achievement.

Characteristics of Rapidly Growing Economies

In the work entitled "Meeting the Demand for Skilled Workers in a Rapidly Growing Economy — Malaysia," published by the International Labour Office, one of the defining characteristics of a rapidly growing economy is identified as the lessening of unemployment and the expansion of opportunities for workers. Furthermore, wages generally rise in rapidly expanding economies. In Malaysia, wages rose by 10 percent annually for skilled and semi-skilled workers, while wages for managers, technical workers, and professionals rose by 7.5 percent, and wages for unskilled workers rose by 5 percent. Unemployment rates in Malaysia fell to below 3 percent during the last decade, and "Malaysia's economy has experienced a sharp turnaround since the recession of 1985–1986" (International Labour Office, 2003).

While the rise in wages and the fall in unemployment rates are very positive indicators, a significant challenge remains in Malaysia's economy regarding wage differentials. As the report notes: "There are many reasons for these wage patterns, not all of which have implications for vocational education and training. But studies show that the main reason for widening wage differentials is that the supply of skilled workers has not kept pace: managerial and technical workers have the lowest supply elasticity, followed by skilled, semi-skilled and unskilled workers" (International Labour Office, 2003). This skills gap represents a structural challenge within otherwise rapidly growing economies.

Conclusion

Stated outcomes of this rights-based framework span the areas of "parliamentary development, justice, decentralization, local governance and urban/rural development, public administration, poverty reduction, HIV/AIDS, crisis prevention and recovery, energy and environment, and gender and the advancement of women." These outcomes are understood to "contribute directly to the realization of one or several civil, political, economic, social and cultural rights of the individuals and groups in society" (Centre for Community Enterprise, 2006). Critically, these development programs must "explicitly address issues of equality, nondiscrimination, participation, inclusion, accountability and rule of law" in connection with their delivery. Expected outcomes include social transformation, democratic government, and universal ethics.