Economic activity and development
What the domain tests
Economic activity and development questions test how livelihoods are classified, how countries change economically, and how development is measured beyond income. Expect questions on Namibia's mining, agriculture, fishing, tourism and informal sector, and on inequalities within and between countries.
Core rules and concepts
- Economic activities are primary (extracting raw materials), secondary (manufacturing), tertiary (services) and quaternary (knowledge and research).
- Formal activities are registered and taxed; informal activities are unregistered and often missed by official statistics.
- Development is a broad improvement in well-being. Indicators include GDP per capita, life expectancy, literacy, access to clean water, HDI and the Gini coefficient. GDP measures output, not distribution or environmental cost.
- Many African economies depend on exporting primary products, which can suffer price fluctuations and limited value added. Diversification and processing raw materials locally can raise income.
- Namibia has a relatively high GDP per capita for the region but high inequality, unemployment and dependence on mining exports. Tourism and conservation can create rural jobs but are seasonal and sensitive to global demand.
Worked example
Two countries have similar GDP per capita, but one has a much higher HDI. Explain how this is possible. Reasoning: GDP per capita is an average income measure. HDI combines income with life expectancy and education. The higher-HDI country may have better health care, school enrolment and literacy, and a more equal income distribution. A country can have high average income from minerals while many people remain poor. Use at least two named indicators.
Traps that cost marks
- Treating GDP growth as the same as development.
- Classifying tourism as primary because it uses natural attractions; it is tertiary.
- Ignoring the informal sector when discussing employment.
- Describing inequality without using a measure such as the Gini coefficient.