Endogenous NIC-Formation in a North-South Framework

Lynn Mainwaring

Journal of Evolutionary Economics, 1993, vol. 3, issue 4, 317-35

Abstract: In a model where initially the North specialises in manufactures and the South in primary products, international investment leads to a rising Northern growth rate. If this rate comes to exceed that of Northern labour growth, a full-employment barrier is reached, pushing up Northern wages. This may lead Northern capitalists to divert some manufacturing production to a favoured part of the South. Additional mechanisms are postulated that allow capitalists in the South to participate in, and possibly dominate, manufacturing accumulation in that region.

Date: 1993
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