This book deals with specific problems in Colombia as a means of exploring interrelated theoretical themes in the development process. Demographic and political as well as specifically economic variables arc given consideration in the authors' analysis of the constraints on the growth of Colombia's modern sector.
Originally published in 1971.
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Structural Change in a Developing Economy
Colombia's Problems and Prospects
By Richard R. Nelson, T. Paul Schultz, Robert L. SlightonPRINCETON UNIVERSITY PRESS
Copyright © 1971 The Rand Corporation
All rights reserved.
ISBN: 978-0-691-04163-6Contents
Preface, v,
List of Tables, ix,
List of Figures, xii,
I. Introduction, 3,
II. Population Growth: Investigation of a Hypothesis, 8,
III. Internal Migration: A Quantitative Study of Rural-Urban Migration in Colombia, 45,
IV. Manufacturing Development: Factor Endowments and Dualism, 77,
V. Urban Income Distribution in a Dual Economy, 128,
VI. Constraints on the Growth of the Modern Sector, 157,
VII. The Political Determinants of Colombian Foreign Exchange Policy, 215,
VIII. Future Development Policy, 262,
Index, 313,
CHAPTER 1
Introduction
To some readers this book is mostly about Colombia. To us, the authors, it is about the development process generally. We do not pretend to have created a new "theory of development." However, the approach is quite different from traditional treatments. We have taken three important themes of the development process, examined and modeled these in some detail, and tried to show how these themes relate to each other. These themes are: the relationship between economic development and rapid growth of population and internal migration; development as a process of structural change in a technologically dualistic economy; and policymaking as a behavioral response by the government to the shifting policy preferences of the governed.
Why did we choose to organize this study around these three themes? First of all, it seemed to us that we could not hope to understand the development process unless population growth and rural-urban migration were built endogenously into the analysis and brought center stage. To be sure, the surge of population growth being experienced in Colombia and almost all other less developed countries is in part exogenous to their own internal developments — the result of widespread application of new public health techniques to control endemic disease. Nonetheless, part of the fall in the death rate must have been related to the sharp improvement in consumption levels coincident with the post-World War II spurt of economic growth. More important, the consequences of decreases in the death rate on the rate of growth of population depend on what happens to the birth rate, in particular, the extent and speed with which it declines, and this is in part a function of changes in economic structure. The pattern of migration is similarly endogenous to the development process, for migration is the reflection of a disequilibrium in the labor market that derives from uneven regional expansion of population, or economic opportunities, or both.
The literature on the determinants of population growth and migration is quite sketchy. The material presented in Chapters II and III aims to carry both theoretical and empirical analysis a considerable distance forward. These chapters develop several models and test them against data in a number of different countries, not just Colombia.
It seemed natural that these chapters should come first. The analysis of population growth and migration provides an extremely useful way to cut into the network of simultaneous dynamic relationships that are involved in the growth process. Population growth at once is a principal determinant of one of the major factors of production — labor — and at the same time strongly influences the magnitude and composition of th
