Truncated Industrialization and Tertiary Substitution: A Summary

Revista Problemas del Desarrollo, Vol. 37, No. 147, pp. 45-80, October/December 2006

40 Pages Posted: 26 Feb 2007 Last revised: 28 Jan 2008

See all articles by Hubert Escaith

Hubert Escaith

Independent; World Trade Organization (WTO)

Abstract

The paper analyzes the evolution of labor productivity in Latin America in the period 1960-2003, applying shift-share analysis to sectoral data. The results are compared with Asian countries. Unlike Asia, Latin American industry has not been able to assume fully its role as pole of development and the expected productive transition towards industrialization has been truncated. An insufficient demand for labour from the industrial sectors has resulted in a deterioration of jobs created in services, culminating in labor informality, greater inequality and a systemic loss of competitiveness. A review of the initial conceptual model is proposed to incorporate these newly stylized facts and to specify the macroeconomic restrictions that impeded a full transition towards industrialization, favoring the emergence of a new economic and social dualism. An abstract in English introduces the original article published in Spanish.

Keywords: Development Economics, Labour Productivity, Informal Sector, Latin America

JEL Classification: 011, 041, 054

Suggested Citation

Escaith, Hubert, Truncated Industrialization and Tertiary Substitution: A Summary. Revista Problemas del Desarrollo, Vol. 37, No. 147, pp. 45-80, October/December 2006, Available at SSRN: https://ssrn.com/abstract=963578

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