ABSTRACT
Three critical dimensions of economic development are evident in Meier’s (1985: 6) popular definition of development: it is ‘a process whereby the per capita real income of a country increases over a long period of time – subject to the stipulation that the number below “an absolute poverty line” does not increase, and that the distribution of income does not become unequal’. Despite its popularity, this definition fails to offer a clear guideline in cases where growth in per capita income (or economic growth) is accompanied by a reduction in poverty but a simultaneous increase in inequality. Does such a case constitute development? In the light of this anomaly, the chapter adopts an ‘absolute poverty approach’, where the emphasis is on a sustained improvement in the living standards of the poor within the context of per capita income growth. This approach, unlike the one espoused by Meier, does not allow regressive movements in income inequality to dominate the poverty criterion. Applying this approach to the East Asian NIEs reveals the familiar story that these economies have truly experienced development in the sense that they have shown a sustained – and rapid – decrease in poverty within the context of rapid growth. Their record on income inequality is more mixed. Some of the countries have experienced episodic increases in inequality – as will be documented in greater detail at subsequent stages – although they still remain among the most egalitarian countries in the developing world.
