Dual economy modelSurplus labourThe Lewis dual economy model is widely recognised in development economics for its profound explanatory power and applications in economic development. However, there remain some confusions and ambiguities, especially with respect to the definition of surplus labour and the...
Lewis’s Theory: Sir William Arthur Lewis’s influential essay, ‘Economic Development with Unlimited Supplies of Labor,’ proposed that countries with surplus labor could industrialize by paying wages just high enough to attract workers away from family farms. Key Assumptions: The model assumed that...
Surplus labourThe Lewis dual economy model is widely recognised in development economics for its profound explanatory power and applications in economic development. HoweverWang, XiaobingPiesse, JeniferSocial Science Electronic PublishingWang X, Piesse J. 2009. `Economic Development and Surplus Labour: A...
When Keynes's General Theory appeared, it was thought at first that this was the book which would illuminate the problems of countries with surplus labour, since it assumed an unlimited supply of labour at the current price, and also, in its final pages, made a few remarks on secular econo...
butlabourceasedtobeunlimitedinsupply,andtheformalmodelofeconomicanalysiswasnolongerexpectedtoexplaintheexpansionofthesystemthroughtime.ThesechangesofassumptionandofinterestservedwellenoughintheEuropeanpartsoftheworld,wherelabourwasindeedlimitedinsupply,andwhereforthenexthalfcenturyitlookedasifeconomicexpansioncouldindeedbe...
Lewis, “Economic Development with Unlimited Supplies of Labour”* (1954) 1. This essay is written in the classical tradition, making the classical assumption, and asking the classical question. The classics, from Smith to Marx, all assumed, or argued, that an unlimited supply of labour was ...
with the relative prices of commodities as a minor bye-product. Interest in prices and in income distribution survived into the neo-classical era, but labour ceased to be unlimited in supply, and the formal model of economic analysis was no longer expected to explain the expansion of the syste...
The Lewis model predicts that as economic growth takes of in a low-income country, wokers will move from the industrial sector and at a certain point called "the Lewis turning point" surplus lbor in the agricultural sector will be depleted and this will lead to sharply increased wages. ...
classicalera,but labourceasedtobeunlimitedinsupply,andtheformalmodelofeconomicanalysis wasnolongerexpectedtoexplaintheexpansionofthesystemthroughtime.These changesofassumptionandofinterestservedwellenoughintheEuropeanpartsof theworld,wherelabourwasindeedlimitedinsupply,andwhereforthenexthalf centuryitlookedasifeconomic...
aThe paper examines the contentious issue of the extent of surplusabour that remains in China. China was an extreme example of a surplslabour economy, but the rapid economic growth during the period of economic reform requires a reassessment of whether the second stage of the Lewis model has ...