Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/183548
Authors: 
Bender, Dieter
Year of Publication: 
2012
Series/Report no.: 
IEE Working Papers 194
Abstract: 
This paper analyzes the effects of structural change on the rates of growth of wages, employment and per-capita income in low-income countries, their dualistic structure shown by a Lewis-type two-sector model. Structural change is measured by the varying shares of sectoral employment in total employment. It is shown that the growth rates of GDP and per-capita income can be formulated as functions of these sectoral employment shares. Distinguishing the phases of dualistic development with and without labour surplus and post-dualistic development, it is demonstrated that each of these stages exhibits different growth dynamics: high but falling growth rates under dualistic development with labour surplus, low but rising growth rates under dualistic development after absorption of the labour surplus, growth rates falling again and converging toward a higher income steady state in the post-dual economy. As the growth dynamics of dualistic development are explained by a modified Lewis model and those of post-dualistic development by the Solow model, the study also highlights the complementary roles both models are playing in development economics.
Subjects: 
Economic growth
Dualistic development
Labour surplus
Rural-urban migration
JEL: 
O11
O41
ISBN: 
978-3-927276-80-2
Document Type: 
Working Paper
Social Media Mentions:

Files in This Item:
File
Size
1.61 MB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.