What makes the Lewis model a "development" model rather than a "growth" model? What insights on development can be derived from the model?
What will be an ideal response?
The basic point here is that Lewis is addressing structural change, rather than the rate of growth, and starts with a characterization of a poor country rather than an abstract economy. The insights derive from addressing the peculiarities of subsistence and modern sectors, and the problems of transition of a population from one to the other.
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An open market ________ by the Fed increases interest rates and ________ output
A) purchase; increases B) sale; decreases C) purchase; decreases D) sale; increases
Explain the rules for finding maximum profit using total revenue and total cost and marginal revenue and marginal cost.
What will be an ideal response?
Outsourcing is being practiced by
A) U.S. firms that want to keep jobs at home in the United States. B) overseas firms hiring in the U.S. labor market and by U.S. firms hiring in foreign labor markets with lower wages. C) U.S. firms only. D) governments but private firms are not allowed to outsource work.
Total revenue minus total cost is equal to
A. profit. B. the rate of return. C. net cost. D. marginal revenue.