Kaldor’s Vision of the Growth and Development Process

Nicholas Kaldor is perhaps best known in the economics profession for his contribution to growth and distribution theory as part of the Cambridge (England) challenge to the neoclassical theory of growth and distribution, which itself was a response to the pessimism of Harrod concerning the possibility of long-run equilibrium growth. In the mid-1960s, however, Kaldor turned away from abstract growth theory and began to turn his attention to the applied economics of growth, both nationally and internationally He developed a vision of the growth and development process, which became part of his challenge to equilibrium theory, which he used to explain the continuing divergence in living standards between primary producing regions on the one hand and industrial regions on the other (within countries and between countries). The vision is in the spirit of centre-periphery models of growth and development, but with novel features.