Economics Dictionary of ArgumentsHome
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| Developing countries: Developing countries are sovereign states with a less developed industrial base and a lower Human Development Index (HDI) relative to other countries. They are characterized by lower standards of living and poorer health, education, and infrastructure compared to developed countries. See also Development economics._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
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Daron Acemoglu on Developing Countries - Dictionary of Arguments
Acemoglu I 258 Developing Countries/dual economy/Arthur Lewis/Acemoglu/Robinson: The “dual economy” paradigm, originally proposed in 1955 by Sir Arthur Lewis(1), still shapes the way that most social scientists think about the economic problems of less-developed countries. According to Lewis, many less-developed or underdeveloped economies have a dual structure and are divided into a modern sector and a traditional sector. A. The modern sector, which corresponds to the more developed part of the economy, is associated with urban life, modern industry, and the use of advanced technologies. B. The traditional sector is associated associated with rural life, agriculture, and “backward” institutions and technologies. Backward agricultural institutions include the communal ownership of land, which implies the absence of private property rights on land. Labor: Labor was used so inefficiently in the traditional sector, according to Lewis, that it could be reallocated to the modern sector without reducing the amount the rural sector could produce. For generations of development economists building on Lewis’s insights, the “problem of development” has come to mean moving people and resources out of the traditional sector, agriculture and the countryside, and into the modern sector, industry and cities. E.g., South Africa was one of the clearest examples, split into a traditional sector that was backward and poor and a modern one that was vibrant and prosperous. Even today ((s) 2017) the dual economy Lewis identified is everywhere in South Africa. Acemoglu I 259 AcemogluVsLewis, Arthur: According to this perspective, then, economic development should simply be about ensuring that the Transkei ((s) the less developed part) eventually turns into Natal. This perspective has much truth to it but misses the entire logic of how the dual economy came into existence and its relationship to the modern economy. The backwardness of the Transkei is not just a historic remnant of the natural backwardness of Africa. The dual economy between the Transkei and Natal is in fact quite recent, and is anything but natural. Causes: It was created by the South African white elites in order to produce a reservoir of cheap labor for their businesses and reduce competition from black Africans. The dual economy is another example of underdevelopment created, not of underdevelopment as it naturally emerged and persisted over centuries. Acemoglu I 270 The dual economy of South Africa did come to an end in 1994. But not because of the reasons that Sir Arthur Lewis theorized about. It was not the natural course of economic development that ended the color bar and the Homelands. Black South Africans protested and rose up against the regime that did not recognize their basic rights and did not share the gains of economic growth with them. After the Soweto uprising of 1976, the protests became more organized and stronger, ultimately bringing down the Apartheid state. It was the empowerment of blacks who managed to organize and rise up that ultimately ended South Africa’s dual economy in the same way that South African whites’ political force had created it in the first place. >Development economics. 1. Lewis, W. Arthur (1954). “Economic Development with Unlimited Supplies of Labour.” Manchester School of Economic and Social Studies 22: 139–91._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Acemoglu II James A. Acemoglu James A. Robinson Economic origins of dictatorship and democracy Cambridge 2006 Acemoglu I James A. Acemoglu James A. Robinson Why nations fail. The origins of power, prosperity, and poverty New York 2012 |
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> Counter arguments against Acemoglu
> Counter arguments in relation to Developing Countries
