Ira Gang
Rutgers University
Department of Economics
E-mail: gang@economics.rutgers.edu

Item Number:  [J6]
Title: Employment, Output and the Choice of Techniques: The Trade-Offs Revisited
Abstract: In this paper we explore the choice of techniques issue in a dual economy model with unemployment in the urban sector.  Conventional wisdom suggests taht developing socieities attempting to modernize and transfrom backward sectors into advanced ones do so by choosing labor intensive technologies to avoid rising unemployment.  We analyze the effect of labor intensive technology on (a) the level of urban unemployment, and (b) the relationship between the levels of urban employment and unemployment.  We show under quite reasonable conditions that choosing a labor intensive technoloyg will actaully aggravate the unemployment problem.  We also show that the nature and pattern of the trade-off between modernization and employment are crucially dependent on the existeing agriculutral technology.

Reference:  Employment, Output and the Choice of Techniques: The Trade-Offs Revisited, Journal of Development Economics, 25 (1987) 321-327.

Co-Author Information:
Shubhashis Gangopadhyay
India Development Foundation
E-Mail:  shubg@vsnl.com

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