Economic Development and the Division of Production between Households and Markets

Luis Locay

Journal of Political Economy, 1990, vol. 98, issue 5, 965-82

Abstract: A model is presented in which scale economies give market production a cost advantage over household production, but in which market production is limited by the extent of the market. The author views the production process as a series of stages, each further refining and specializing the product of the previous stage. As processing proceeds, the number of intermediate goods increases and markets thin out. Firms specialize in the early stages of production and households in the later stages. As an economy grows, production shifts out of households and into the market. Several other changes associated with economic development are also accounted for. Copyright 1990 by University of Chicago Press.

Date: 1990
References: Add references at CitEc
Citations: View citations in EconPapers (43)

Downloads: (external link)
http://dx.doi.org/10.1086/261715 full text (application/pdf)
Access to full text is restricted to subscribers. See http://www.journals.uchicago.edu/JPE for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ucp:jpolec:v:98:y:1990:i:5:p:965-82

Access Statistics for this article

More articles in Journal of Political Economy from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().