THE RATES OF LONG-RUN ECONOMIC
GROWTH AND CAPITAL TRANSFER FROM
DEVELOPED TO UNDERDEVELOPED AREAS

WASSILY (LEONTIEF
Harvard University - Cambridge. Mass. - U.S.A.

1. The Underdeveloped Areas, which hold at least twothirds
 of the entire population of the world, produce now only
about one-seventh of the world’s gross output of goods and
services; moreover, their rate of economic growth is at the
present time much lower — possibly only half as high — as
that of the advanced industrialized countries. That means that
the contrast between the richer and the poorer areas tends to
increase rather than diminish.
A rise in the rate of growth of the Underdeveloped Areas
would demand an increased volume of productive investment.
The additional capital could be created through stepped up
internal savings, or it might be obtained from abroad, that
is, transferred in the form of aid, foreign loans, or direct private
 investment from the Developed countries.
How much additional investment would the Underdeveloped
 parts of the world have to absorb if they were to raise their
average growth rate, over the next ten year period, up to the
average growth rate of the economically advanced industrial
countries? If capital transferred from Developed to Under

3

Leontief - pag.