Study week on the econometric approach to development planning

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Monograph

Identifikator:: 1824422792

URN:: urn:nbn:de:zbw-retromon-217476

Document type:: Monograph

Title:: Study week on the econometric approach to development planning

Place of publication:: Amsterdam [u.a.]

Publisher:: North-Holland Publ. Co. [u.a.]

Year of publication:: 1965

Scope:: XLVII, 1259 S.; graph. Darst.

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: The rates of long-run economic growth and capital transfer from developed to underdeveloped areas / Wassily Leontief, Harvard University - Cambridge, Mass. - U.S.A.

Collection:: Economics Books

SEMAINE D'ÉTUDE SUR LE ROLE DE L ANALYSE ECONOMETRIOUE ETC 106 output corresponding to the fixed capital/output ratio entering in my equation 2. Accordingly, my computations show essentially the upper limits of the future growth in national income that can be expected to be brought about by various combinations of domestic savings and in- ternational capital transfer, If the supply of other factor — such as skilled labor, efficient management and natural resources — could not expand proportionately the actual increase in income would in each case fall short of that, in a certain sense, maximal rate. I used the capital/output ratio essentially as a limiting factor. Not saying that this amount of capital transfer is sufficient to produce that output, I on the other hand imply that without the indicated rate of capital transfer the corresponding rate of income growth — computed on the basis of my formulae — could hardly be attained Professor ALLAIS does not seem to disagree with this. So far as the political conclusions — which he expects to be drawn from the results of my analysis — are concerned, he might be right or he might be wrong; it all depends on the additional — political — premises which will have to be introduced before one would be justified to draw them. ALLAI. I agree completely with what Professor LEONTIEF has said but : wish to stress two points. First, precisely in this particular line, an attempt is made to calculate some limits of the capital effect, and this attempt is very interesting indeed. But if this is done, b should be replaced in equation 2 by b/8 where 3 is equal to 0.2 and not 1, if we accept the results of the Douglas researches and those of his followers. My second point is that, so far as underdeveloped coun- tries are concerned, we must be very cautious in extrapolating data which are valid for the West. This, I think, is the error that Douglas himself has committed in assuming that his relation could represent the production function over a verv large range. What he has shown -31 Leontief - pag. 23

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