(1) According to Boeke, "These three aspects are interdependent and in this connection typify a society, in this way that a prevailing social spirit and the prevailing forms of organisation and of technique give the society its style, its appearance, so that in their interrelation they may be called the social system, the social style or the social atmosphere of that society. The Dual Society According to Boeke, it is not necessary that a society be dominated exclusively by one social system. If one social system does prevail, the society in question is a homogeneous society. When, on the contrary two (or more) social systems appear simultaneously, we have a dual society. Boeke qualifies the term dual society by using it only for societies "showing a distinct cleavage of two synchronic and full grown social styles which in the normal, historical evolution of homogeneous societies are separated from each other by transitional forms, as for instance, pre-capitalism and high capitalism by early capitalism." This qualification is necessary because every society going through the process of evolution or endogenic social progression shows besides the prevailing social systems, the remains of the preceding and the beginnings of its future social style. If, on the other hand, one social system is imported from abroad and this system fails to oust or assimilate the prevailing social system, a dual society obviously exists. On this account Boeke defines a dual society as a society where "one of the two prevailing social systems, as a matter of fact always the most advanced, will have been imported from abroad and have gained its existence in the new environment without being able to oust or assimilate the divergent social system that has grown up there, with the result that neither of them becomes general and characteristic for that society as a whole." Development in dualism concepts is the suppression of the traditional sector by concentrating on and expanding the modern sector. In time, it is assumed that the trickle down effects will reduce and abolish dualism. In this line of thinking, the main problem is capital formation because its degree determines the scope and speed of expansion of the modern sector. In general, agriculture has to provide the resources, labour as well as capital, for expanding the modern sector. In details, the strategies vary. Some authors, like LEWIS (14) and FEI/RANIS (5), assumed that a reduction of the labour force in agriculture, because of the widespread disguised unemployment, would not reduce agricultural production. The productive employment of these labourers in the modern sector would increase the total production of the economy and hence priority of investment in industry is necessary. Concentration on the modern sector led to an increasing regional disparity, rural urban migration, urban unemployment, a decrease in agricultural production, and hindrance in industrial development because of a lack of purchasing power in the rural areas. The anticipated trickle-down effects hardly ever happened. In praxis, development plans following this line of thinking led to failures like the early Indian development planning. The Dual Society According to Boeke, it is not necessary that a society be dominated exclusively by one social system. If one social system does prevail, the society in question is a homogeneous society. When, on the contrary two (or more) social systems appear simultaneously, we have a dual society. Boeke qualifies the term dual society by using it only for societies "showing a distinct cleavage of two synchronic and full grown social styles which in the normal, historical evolution of homogeneous societies are separated from each other by transitional forms, as for instance, pre-capitalism and high capitalism by early capitalism. This qualification is necessary because every society going through the process of evolution or endogenic social progression shows besides the prevailing social systems, the remains of the preceding and the beginnings of its future social style. If, on the other hand, one social system is imported from abroad and this system fails to oust or assimilate the prevailing social system, a dual society obviously exists. On this account Boeke defines a dual society as a society where "one of the two prevailing social systems, as a matter of fact always the most advanced, will have been imported from abroad and have gained its existence in the new environment without being able to oust or assimilate the divergent social system that has grown up there, with the result that neither of them becomes general and characteristic for that society as a whole." Overiding importance of social nedds The first characteristic of dualistic economies pointed out by Boeke is the relatively greater importance of social needs as compared to western economies.Boeke states, "Possessions in the share of cattle, land, clothes, and houses, the fulfilment of social duties in all the circumstances of likr, must be all regarded as largely the satisfaction of social needs. It is not their economic usefulness, not the individual services they render their possessor which determine the value of the goods. It is a matter of secondary importance whether the land produces reasonable profit in proportion to the money paid for it whether the cattle can be made reasonably useful to their owner in his own business,whether the clothing covers, protects,warms the wearer or affects him pleasantly in any way. For it is not the use of these objects to the subject himself that gives them their worth in his eyes; it is what the community thinks of them that sets the standard. A dual economy is the existence of two separate economic sectors within one country, divided by different levels of development, technology, and different patterns of demand. The concept was originally created by Julius Herman Boeke to describe the coexistence of modern and traditional economic sectors in a colonial economy. Dual economies are common in less developed countries, where one sector is geared to local needs and another to the global export market. Dual economies may exist within the same sector, for example a modern plantation or other commercial agricultural entity operating in the midst of traditional cropping systems. Sir Arthur Lewis used the concept of a dualistic economy as the basis of his labour supply theory of rural-urban migration. Lewis distinguished between a low-income, rural, subsistence sector with surplus population, and an expanding urban capitalist sector. The urban economy absorbed labour from rural areas (holding down urban wages) until the rural surplus was exhausted. A World Bank comparison of sectoral growth in Cote d'Ivoire, Ghana and Zimbabwe since 1965 provided evidence against the existence of a basic dual economy model. The research implied that a positive link existed between growth in industry and growth in agriculture. The authors argued that for maximum economic growth, policymakers should have focused on agriculture and services as well as industrial development …….We would contend that China, India, Bangladesh, as well as much of Central America and some portions of South America, comprising a majority of the people on earth, still meet the initial conditions for dualism relevance, i.e., a substantial food producing agricultural sector marked by heavy population pressure on scarce land, complemented by large urban informal sectors. And, while Sub-Saharan Africa was once described as “land surplus,” there is increasing evidence, from high fertility rates, changing cultivation practices and a general reduction of fallow periods, that this pivotal region is also moving in the same direction. In these settings the issue addressed with the help of the dualism model, i.e., how to mobilize an agricultural surplus by reallocating an underemployed labor force into efficient non-agricultural pursuits, remains at the top of the development agenda. The dualistic theory nexus, moreover, remains useful for a number of analytical reasons, including concerning the relationship between growth and the distribution of income, for the determination of the domestic inter-sectoral terms of trade, as well as for the choice of technology and of the direction of technology change. We, finally, inquired into the usefulness of the dualism concept for explaining both historical and prospective country development experience, as well as its relevance in general to contemporary economic modeling efforts. We found that the basic dualism model well fits the historical experience of such countries as England, Japan, and Taiwan and believe it is likely to continue to be relevant for China, India, parts of Africa and Latin America, among others. We believe, moreover, that there is ample room for further exploring the relationship between neo-classical insurance and classical altruism models as well as for forging better connections between the new behavioral economics and a revived application of dualism to both development theory and policy in large portions of the developing world. Tendencies within the field of science and technology, including their increasing capital intensity and their increasing dominance by the needs of the richer countries and lack of direct relevance for the needs of developing countries are closely associated with growing unemployment and under‐employment in various forms within the developing countries. More and more the relevant forms of dualistic fission run along the line of employed versus unemployed rather than the more traditional distinctions between rural and urban sectors, traditional versus modern sectors, etc. The tendency for technological developments to produce internal dualism in the under‐developed countries is further strengthened by a number of factors, including the association of modern technology with foreign investment. The challenge of development in the post-colonial poor countries was sought to be addressed by development planning. The analytical concept of dualism, as formulated by Arthur Lewis (1954), proved to be a powerful one that held sway in development literature. It was also a stylised way to reduce the complexities of an underdeveloped economy into a dual sector system consisting of agriculture and industry or traditional and modern. Basically it divided the economy into a subsistence sector and a surplus generating sector. The main focus, by definition, was on low labour productivity in the subsistence sector. It was posited that a process of development entails the expansion of the high productivity sector absorbing more and more labour from the subsistence sector, i.e., from agriculture. While this concept of dualism implied inequality, the focus was on the sectoral characteristics and only indirectly between people working and depending on it. The arrival of the notion of informal employment did indeed help to focus on the characteristics of the people in the subsistence sector but in the process it also went beyond the sectoral notion of dualism. Characteristics of a Dualistic Economy Overiding importance of social nedds The first characteristic of dualistic economies pointed out by Boeke is the relatively greater importance of social needs as compared to western economies.[3] Boeke states, "Possessions in the share of cattle, land, clothes, and houses, the fulfilment of social duties in all the circumstances of likr, must be all regarded as largely the satisfaction of social needs. It is not their economic usefulness, not the individual services they render their possessor which determine the value of the goods. It is a matter of secondary importance whether the land produces reasonable profit in proportion to the money paid for it whether the cattle can be made reasonably useful to their owner in his own business,whether the clothing covers, protects,warms the wearer or affects him pleasantly in any way. For it is not the use of these objects to the subject himself that gives them their worth in his eyes; it is what the community thinks of them that sets the standard. 1.1 DUALISM THEORIES Dualism theories assume a split of economic and social structures of different sectors so that they differ in organization, level of development, and goal structures. Usually, the concept of economic dualism (BOEKE 1) differentiates between two sectors of economy: the traditional subsistence sector consists of small-scale agriculture, handicraft and petty trade, has a high degree of labour intensity but low capital intensity and little division of labour; The modern sector of capital-intensive industry and plantation agriculture produces for the world market with a capital-intensive mode of production with a high division of labour. The two sectors have little relation and interdependence and develop each according to its own pattern. The modern sector can be considered an economic enclave of industrial countries, and its multipli-cator and growth effects will benefit the industrial countries but have little effect on the internal market. Several authors stress the dualism of specific factors. ECKHAUS (4), for instance, differentiates, in his concept of technological dualism, between labour and capital-intensive sectors. GANNAGE (7) explains regional dualism as a lack of communications and exchange between regions, the capital sometimes being an island which, in geographical terms, belongs to the developing country, in economic terms, however, to the industrialized country. Economic, technological, and regional dualism are often the consequence of a social dualism, the absence of relationships between people of different race, religion, and language, which, in many cases, is a legacy of colonialism. J.H. Boeke (1953) Economics and Economic Policy of Dual Societies, New York: Institute of Pacific Relations. Lewis, W. Arthur (1954), ‘Economic Development with Unlimited Supplies of labour’ in Manchester School of Economic and Social Studies, Vol.22, pp.139-91. Kannan, K. P. (1994), ‘Levelling Up or Levelling Down? Labour Institutions and Economic Development in India’, Economic and Political Weekly, July 23, pp. 1938-45.
You Read without commenting? How do you even sleep?.. Please drop your opinion here, Thanks...
Disclaimer: Comments on this blog are not written by the owner, therefore, the blog owner will not be liable for any comment made by readers.