The study of economic development is one of the newest, most dashing and most attracting branches of the broader disciplines of economics and political economy. It was the world poverty, backwardness, unequal income distribution, the rising gulf between the countries of the world, and special circumstances prevailing in Africa, Asia and Latin America which led this branch of economics to come forward. The development economics does not have a separate identity like Microeconomics, Macroeconomics, Monetary economics and Labour economics.
However, it draws relevant principles and concepts from other branches of economics and they are applied to solve the problems which are faced by the economies of Asia, Africa and Latin America as their economies differ from the economies of Europe, America and Australia. Thus, the development economics is not the same to that of economics of advanced countries, (the modern neo-classical economics).
Again, it is not similar to the economic ideas which were implemented in socialist or communist economies (Marxist or Command economies). It actually is, the economics of poor world, backward and third world countries which have a variety of differences regarding natural resources, cultures, ideas and outlooks. Such all requires for new ideas and approaches which could tackle the problems of poverty and backwardness.
The Nobel Prize in Economics in 1979 was awarded to two Development Economists like W. Arthur Lewis and Theodore Shultz for their pioneering studies of development process. As Schultz in his Nobel Lecture (1979) said “Most of the people in the world are poor, so if we knew the economics of being poor, we would know much of the economics that really matters”.
Thus “Economic Development is a branch of economics which deals with causes and cures of mass poverty”. Thus, development studies pay attention on involuntary deprivation of fundamental material comforts of life competent medical attention and primary education. The involuntary deprivation that accompanies mass poverty has a self-fulfilling and self-perpetuating character.
It is hard to overcome because it consists of a series of vicious circles, or a sot of interlocking equilibrium circumstances that reinforce one another. The poor people consume less and fail to work hard. They earn little hence cannot save much. They think that more children they have more their income will be. Thus, it is in their interest to produce more children, but not in the interest of the society. The poverty of the poor people is transmitted to their children.
These poor persons have to live with the people who are extra-ordinarily rich and powerful. The rich exercise their own views mostly from the Western economics, regarding the economy and sociology. In this way, a tension is developed amongst the poor and the rich in the poor countries. A few rich would like to get more and more wealth in these poor countries where the infant mortality rate is high, general educational levels are low, cities are crowded dirty, and unpleasant, and public facilities are lacking and missing. Thus, the poor countries fail to meet the common visions of the good life.