Question

Many people throughout the world are concerned about poverty, and would like to help improve living standards in developing countries. There are two main approaches that developed countries might use to help developing countries: (1) provide aid in the form of cash or goods (e.g. agricultural products), and (2) open up developed country markets to provide an opportunity for developing countries to trade with developed countries.

What are advantages/disadvantages of each approach? and Which approach is better?

Answer 1

Ans. 1) Provide aid in the form of cash

Advantages

It would help the developing economies to invest more in their own economy and become economically sound.

It would help the developed economy to get a minor role in the decision making process of the developing economy , this would also cater the interests of developed economy.

Disadvantages

The developing economies would fear because of the increased intervention by the developed economies.

The return on loan given to the developing economy would be uncertain for the developed economy and there would be possibility of losses.

2) Open up developed country's market :

Advantages

This would help the developing economy to become self sufficient and would give them a chance to increase exports.

This would help the consumers of developed economy because they'll be getting cheaper imports from developing economies.

Disadvantages

This would pose a threat to the producers of developed country because of competition from the cheaper imports from developing countries.

This may lead to certain unemployment in the developed country.

I think both the options are equally better and if implemented properly , both would help in yielding better results. Rest , I'll advice you to analyze yourself that which approach sounds good to you.

Best of Luck !! !!