Uneven Development in the Third World

Development has two important aspects: the approaches for achieving this goal and the outcomes in terms of growth, access and equity. Development planners may adopt unevenness or unbalanced growth as a deliberate strategy or it may be incidental to this strategy. Unevenness may also result from wide gaps between planning and expectations and reality. Development decisions are made on the basis of certain assumptions about the functioning of markets and institutions, the availability of resources and their utilisation which often turn out to he not valid in practice.

In this chapter we examine the concept of uneven development in terms of three development models, strategies or processes: (i) unbalanced growth, (ii) urban bias, and (iii) unequal exchange in terms of international resource gaps and inequalities. An attempt is also made to look for empirical measures for these theoretical notions.

In Chapter 3, we briefly discussed the most recent development strategy of economic liberalisation adopted in both China and India. This chapter attempts a more in-depth analysis of this on-going process, accelerated since the early 1990s in both countries. In China, after a temporary slow-down of the reforms subsequent to an overheating of the economy and social unrest in 1989, the process has once again accelerated. On the other hand, in India, the pace of implementation of reforms which were effectively launched during 1991, seems to have slowed down, not for reasons of rapid growth or overheating, but largely because the Government enjoys only a narrow majority and faces opposition from such vested interests as bureaucrats, trade unions, political parties and some businesses.

In Chapter 2 we examined Hirschman’s concept of imbalances and high-linkage industrial growth without providing its empirical analogue. The main purpose of this chapter is to provide a measurement of these linkages. Both backward and forward output and employment linkages are estimated for China and India using input-output (I/O) tables (for China, the table for 1981 has been used,¹ and for India, the table for 1984–5).² A comparison is also made with the Philippines, Indonesia, Malaysia, Bangladesh and Turkey.

This chapter analyses the development performance in China and India in the light of the strategies and policies discussed in Chapters 3 and 4 and linkages and imbalances examined in Chapter 5. The declared objectives of the strategies were both growth and equity. In this chapter, we examine whether rapid rates of growth were achieved in practice, and if so, whether they were due to the strategies that were adopted. To answer these questions, sectoral output and productivity growth rates as well as rates of sectoral investments during the different time periods are reviewed.

In Chapter 6, development outcomes were examined in terms of growth of output, productivity and investment efficiency. In this and the following chapters, 8, 9, and 10, we are interested in reviewing the outcomes of development policies in terms of inequalities of access to technology, health and education. This chapter discusses unequal outcomes with regard to such aspects as income, consumption and other inequalities. These are considered in the context of (i) rural—urban differences, (ii) interregional or provincial variations and (iii) class distinctions.

The economic/spatial inequalities and imbalances will be influenced by the unequal access of different income and social classes to assets, technology, information and other inputs.

The economics of good health is well known, but the contribution of a healthy people to development may be worth repeating: gains in worker productivity, improved utilisation of natural resources, better education and reduction in costs of medical care (resources thus released can be used for other developmental purposes)¹

Access to education or equality of educational opportunities can be defined in several ways. It may mean equality of access to schooling of children of different social and economic classes; or equal opportunity, after schooling, in terms of outcome or results, i.e. children from different social classes would acquire similar income, occupational status and political power.¹ In the real world, even if children start with equal educational opportunities, they may end up with different outcomes with respect to status and earnings, depending on job opportunities available, natural ability and family background, etc. Another aspect of access to education is the effective utilisation of this opportunity which would depend on several factors like affordability, opportunity cost of schooling, motivation, etc.

In this final chapter we briefly review the major findings of the earlier chapters in the light of the political economy factors that may explain similarities as well as differences in development strategies and their outcomes. One cannot really study the economies of China and India (and other developing countries for that matter) without touching on the socio-political contexts in which development strategies, policies and economic reforms are formulated and implemented. Thus this chapter speculates about the influence of non-economic forces on development outcomes generally and in China and India in particular.