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Impact of industrial capitalism on society
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The Lewis Two-Sector Model. Lewis began with the assumption that the economies in Latin America consisted of two sectors: (1) a traditional rural subsistence sector, characterized by zero or very low productivity surplus labor and (2) a high productivity modern urban industrial sector into which labor from the subsistence sector is gradually transferred. The primary focus of the model is both on the process of labor transfer and on the growth of employment in the modern sector. Both labor transfer and urban employment growth are brought about by output expansion in the mode n sector. The speed with which they occur is given by the rate of industrial capital accumulation in the modern sector. Such investment is made possible by the excess of modern-sector profits, on the assumption that capitalists reinvest all of their profits in capital expansion. Finally, the level of wages in the urban industrial sector is assumed to be constant and determined as a fixed premium over a constant subsistence level of wages in the traditional agricultural sector. Lewis assumed the urban wage would have to be at least 30 percent higher than the average rural income in order to induce people to migrate from their home areas into the city. The model thus assumed that rural-to-urban migration was an essential part of the development process, and was, therefore, a good thing. People expected that ISI would lead to the overall development of a country through a series of linked processes: the growth of urban industry; the migration of people out of unproductive jobs in rural areas; the expansion of employment in the productive modern sector; and an increase in the total wages earned by workers. Once this process is set in motion, then, presumably,... ... middle of paper ... ... airplane struggling to get off the ground (initial ISI). Then, when capital is reinvested and more workers are employed in the Modern Sector, and those workers begin to purchase more goods with their higher incomes, the Modern Sector would expand further. And so on as the economy “took off.” The expansion of the Modern Sector in urban Latin America meant that millions of people living in rural areas picked up and left the countryside, in search of better paying jobs in the city. The Modern Sector was unable to absorb all of the newcomers. The result was the growth of poor neighborhoods, mostly located on the outskirts of the city. People living poor urban neighborhoods made a living doing odd jobs such as washing cars, working part time, becoming servants in middle-class households, selling items on the streets, such as newspapers, cigarettes, chewing gum.
While the growth of the urban population led to new technological and industrial developments, it also produced penury, congestion, pollution, fatal disease, and tremendous fires. One of the most important problems that arose from this growth, however, was the absence of a legitimate urban government. Political, or urban, machines filled this void, and through patronage and graft secured votes from as many people as possible for their respective parties4. Immigrants were usually the easiest targets because they frequently did not speak much English, but more im...
[3] "Industrial Metamorphosis." The Economist. The Economist Newspaper Limited, 01 Oct. 2005. Web. 9 Dec. 2013. .
The answer is gentrification. Gentrification is the restoration or improvement of run-down urban areas by the middle class to accommodate their way of life and is prevalent all across the United States in cities such as Portland, Seattle, and Atlanta to
Most of the suburbs were built as small communities with strip malls. This meant that all families had to have at least one car if not two for a second job. Families with a two-income household had it much easier than those with one. This caused an explosion of the middle ...
Despite the development of new machineries, the demand for worker remained relatively high due to the growing numbers of cities. By ...
With little to no work available, people were looking for jobs elsewhere and many were looking in the big cities.
Neoliberalism is a form of economic liberalism that emphasizes the efficiency of private enterprise, liberalized trade, and relatively open markets. Neoliberals seek to maximize the role of the private sector in determining the political/economic priorities of the world and are generally supporters of economic globalization. During the 1930s and the late 1970s most Latin American countries used the import substitution industrialization model to build industry and reduce dependency on imports from foreign countries. The result of the model in these c...
While there were great variations in income between different villages, and between different jobs in the urban sector, the overall averages showed a clear pattern: the cities were much richer than the countryside. Most capital investments were going into urban industries. The urban workers, using considerable amount of heavy machinery, had a much higher average level of productivity compared to the rural workers. The natural consequence was, for the city people, an average income level twice as high as that of the people in the countryside. The most obvious way to attack this poverty problem was to increase production, in all sectors of the economy. Though the easiest way to increase ...
Before the automobile, people both lived in the city and worked in the city, or lived in the country and worked on a farm. Because of the automobile, the growth of suburbs has allowed people to live on the outskirts of the city and be able to work in the city by commuting. New jobs due to the impact of the automobile such as fast food, city/highway construction, state patrol/police, convenience stores, gas stations, auto repair shops, auto shops, etc. allow more employment for the world's growing population.
...an overabundance of information all applicable to the topic. My feeling was that such an overwhelming load of facts and systems directed me away from the most important facts of the chapter. Its imperative that the student understands the small scale relationship to economic development. Therefore my attempt was to highlight the main topics of the chapter and relate them to the reader to provoke intrest and thought towards many of these important life changing situations that occur everyday. If one can see past all the theories primarily and see the cause and effects behind them, they’re appreciation for the ideas stated in the theories.
The second phase following the previous stage is a precondition for take-off. Economic growth is starting to take place and it is essential to justify the means within a good definition. The society begins to implement the manufacturing of products while at the same time foreign intervention by advanced societies such as through colonialism is needed to bring about change in one's society .... ... middle of paper ...
... in rural America. Moreover, the same factors have also revealed that people who endure poverty always look into the possibility of moving to urban areas so as to try and find work to survive. As such, that is the other reason why poverty levels in rural America are higher as compared to those of urban America.
The opening and expansion of the North American and European export market caused market and labor reforms to satisfy demand. The huge demand created incentive for the industrial and infrastructure development. Cities such as Rio de Janeiro and Lima in Peru, and Bogota in Colombia benefited from this economic expansion and soon became big industrial towns. The industrial expansion went hand in hand with population growth as workers were needed to work in these industries.
In an attempt to find out why most governments and economists encourage technological changes even though it increases structural unemployment, it is important to first and foremost understand the meanings of ‘technological change’ and ‘structural unemployment’. Technological change refers the improvement of processes that make it easier to produce more, efficiently and at reduced inputs. On the other hand, structural unemployment refers to a situation where skills needed to produce efficiently cannot be matched to appropriate unemployed persons due to technological change – in other words, it refers to inefficiencies in the labor market.
Industrialization caused population migration from rural areas to urban areas. Cities expanded rapidly to provide homes for workers being employed in the factories. Workers faced harsh conditions everywhere. Living conditions were cramped, unsafe and unclean. Men, women and children labored long hours for minimal wages in dangerous conditions and no job security. The working class was financially and physically unprotected by the government as the middle and upper class grew wealthier and more powerful. (Riane Eisler (2007)).