1. The Lewis Model of Development
... additional workers from the subsistence sector leads to the rise of the marginal productivity of labor in this sector (subsistence). So labor transfer is accompanied by lost food production. However, before the surplus of labor is exhausted, the increase in earnings in the subsistence sector may occur and affect the expansion of the capitalist sector. Lewis explains this with the terms of trade between the two sectors on the assumption that they ... are producing and exchanging different things. Firstly, the change of absolute numbers of population by labor ... ...
- Word Count: 4558
- Approx Pages: 18
- Has Bibliography
- Grade Level: Undergraduate