Seers was a Cambridge trained development theorist who stressed the significance of social development in developing countries before moving to economic development seeing that in order for economic development to reach its maximum potential social development has to occur first. Seers was highly critical of using indexes such as unemployment and inflation when referring to Third World countries, possibly because the statistics we have from these countries are too unreliable for us to be able to make judgments concerning their economies. In other words to Seers true development lay in the elimination of poverty, increase in literacy, improvement in the health system as opposed to the increase of per capita output. Thus one may conclude that the whole concept behind the HDI lies within Seers notion of development.
For example if a third world nation wants to develop it can't be expected to use the same policies as a first world nation. If, for instance, a third world nation had set growth as their macroeconomic target the government can't expect that by cutting taxation and reducing government spending its economy will grow the same way it would if it was a first world nation(fiscal policy). The reason behind this is that if the government in third world countries had taxes in the first place the people would be much worse off than they are now and the other complication is that the government can’t increase spending since all its spending relies on aid. Thus it would be much more beneficial for the governments of these countries to focus on combating illiteracy so as to educate its population and in the future this population will acquire jobs either within the country or abroad and thus poverty will be reduced.
Moreover reduction of inequality is a key issue in Seers theory. When a Third World country wants to develop, it needs a large labor force so as to produce a great number of products at low prices. However with the problem of discrimination in such countries many people are excluded from the labor force for example in the majority of countries women aren’t allowed to work. This issue creates a number of complications due to the following two reasons. The first reason is that there is a reduced labor force and thus the country isn’t producing at national income at full level since factors of production haven’t been used. The second reason is that women not working and being discriminated against leads to an increase in population which may cause problems for a number of reasons. On the one hand women can’t take part in family planning and contraception and thus not only do they end up with diseases like AIDS and syphilis but they also end up having an excess number of children which is why third world coun tries have such a great problem with large population. On the other hand, if women work they have less time to spend at home and end up having fewer children since they will be more geared to work than to give birth to excess numbers of babies.
A final key concept in Seers theory is improvement in health standards. Most third world countries have great problems with HIV and diseases like malaria, thus a key step to development in such countries would be the elimination of such diseases through the improvement of the health system. If the people in these countries became healthier and life expectancy rose than these countries would develop much faster since the labor will be in a much better condition to work which will probably lead to a much more efficient and skilled labor force. Moreover a better health system will mean that less children will be dying and thus more of them will be able to go to school and thus the economy won’t be stuck in a vicious cycle of producing goods of the primary and secondary sector for the first world countries to consume.
Overall I believe that Dudley Seers theory is very accurate and up to date seeing that he has tracked the complications of each social problem of these countries in their economic performance.