MYP Individuals & Societies Political Drivers Notes

What Are Political Drivers of Development?

1. Political conditions shape how resources are collected, how decisions are made, and whether people and firms feel safe enough to plan for the future.
2. These factors are often called political drivers because they can:
   1. Accelerate development (rising standards of living)
   2. Hold it back, even when a country has valuable natural resources or a large workforce.

How Do Political Drivers Determine Whether Development Policies Work?

1. A key political idea in development is economic stability.
   1. When the political environment is unstable (frequent unrest, unpredictable rules, weak enforcement), it affects everyday economic decisions.
   2. Businesses may avoid long-term investment, and banks may lend less.

How Do Stability and Rule of Law Encourage Investment and Productivity?

1. A major political driver is political stability, meaning a country has predictable leadership transitions, low levels of violence, and consistent policies.
   1. Stability supports development because it reduces risk.
2. When stability is missing, entrepreneurs (people who start and run businesses) may decide it is too risky to invest.
   1. A business relies on predictable demand, secure property, and confidence that rules will not suddenly change.
3. Stability also supports the financial sector.
   1. Banks are central to development because they provide startup and investment capital.
   2. If banks are small or fragile, or if there is no strong legal framework to handle economic difficulty (for example, clear bankruptcy rules and credible regulation), lending becomes limited. With less lending:
      1. fewer firms expand
      2. fewer jobs are created
      3. productivity growth tends to be slower

How Does Corruption Divert Resources Away from Public Benefit?

1. In practical terms, corruption can mean that:
   1. taxpayer money is not spent where it helps the most
   2. contracts go to less efficient firms, raising costs and reducing quality
   3. people lose trust in government, weakening compliance with taxes and laws
   4. Corruption also discourages investment.