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Timeline Events / ILO Kenya Employment Mission: Technical Change, Dualism and Employment

In the late 60s and early 70s there was greater attention to the links between technical change and employment. This was evidenced in several reports in which Hans Singer was involved, especially the later 1972 Mission Report to Kenya for the International Labour Organisation, conducted by Hans Singer, Richard Jolly, and Charles Cooper, which highlighted technical change and the application of ‘modern’ capital intensive technology as an important factor in unemployment and underemployment, and from whence came the ‘distribution with growth’ theory. This was embraced in a speech by World Bank president Robert MacNamara to the Bank’s Governors in Nairobi. The speech was followed by the Bank’s landmark change in policy, “Redistribution with Growth”.

“In the late 60s, Singer pointed to the ‘dualistic’ labor structure that had emerged in some countries, characterized by small numbers employed in the modern sector a relatively high wages and an increasing share of the labour force relegated to a marginal existence.” (Jolly et al 2004: 111)

“Singer identified five main factors that accounted for widespread and increasing unemployment in the developing countries at the beginning of the 1970s. These factors were: a) rapid ‘population increase’; b) ‘overwhelming concentration of science and technology in the richer countries, resulting in rapid increases in the overall capital intensity of ‘modern’ techniques, and a corresponding absence of any real incentive toward the creation of labour-intensive or small-scale technology, or a technology adapted to tropical conditions or products; c)the resulting ‘quantum jump’ in labour productivity when ‘modern’ techniques were applied, resulting in the ‘large-scale destruction of traditional employment’; d) the preference for urban life, and a wage and income structure in developing countries which created urban-rural income differentials..; and e) the prevailing social structure in the countryside, which deprived a high proportion of the rural population of access to land and other complementary inputs necessary to utilize their own labour and take advantage of new techniques for raising productivity, resulting in mass migration to urban areas.'” (Shaw, 2002: 159-160)

Singer identified the growing international inequalities in command over modern science and technology as one of the causes of ‘dualism’ both within developing countries and between them and industrial countries.  He argued that tendencies within the field of science and technology, including their increasing capital intensity and their dominance by the needs of the richer countries and lack of direct relevance for the needs of developing countries, were closely associated with growing unemployment and under-employment in various forms within developing countries. Increasingly, the relevant forms of ‘dualistic fission’ ran along the lines of employment versus unemployment rather than the more traditional distinction between rural and urban, and traditional and modern sectors. …The tendency for technological developments to produce internal dualism in developing countries was further strengthened by a number of factors, including the association of modern technology with foreign investment that he had recognized earlier in his original work on the terms of trade.

Singer reiterated that the forces making for dualism were deeply rooted particularly in science and technology.  Much more radical action than a mere redress of discriminatory practices, or correction of prejudices, was needed. He noted that the limited applicability of western concepts was illustrated by the focus on the productive use of scarce capital in developing countries rather than on the mis-utilization of the capital available. The better utilization of existing capital was a problem parallel in importance with a more appropriate technology. Both together held out prospects of approaching development problems along more Keynesian lines than was often realized. Singer therefore concluded that “the utilization of existing capital together with the development of more relevant technology held the key to solving the most important type of dualism in developing countries.” (Shaw, 2002: 174-175)

 

Sources:

Shaw, J. (2002) Sir Hans Singer: The Life and Work of a Development Economist, pp 159-160, 174-175. 

Jolly et al (eds) (2004) UN Contributions to Development Thinking and Practice. Part of the UN Intellectual History Project. Bloomington: Indiana Press 

Singer, H. ‘Dualism Revisited: A New Approach to the Problems of the Dual Society in Developing Countries’, Journal of Development Studies 7.1  Also in IDS Communications 41, 1969.  Originally prepared for a Conference on the Dual Economy held in Glasgow, Scotland, September 1969.

Chenery, H. et al. (1974), Redistribution with Growth. Oxford and New York: Oxford University Press.

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