ABSTRACT
This chapter focuses on the changes in the patterns of production in the 1950s to the Early 1980s and the formation of new structures, showing how the particular type of economic growth created a social and economic structure that put extreme pressure on the political order. It argues that the particular pattern of economic growth, not stagnation and decline, was the genesis of subsequent crises. The chapter discusses all productive activity into four sectors: a modern urban sector, export agriculture, a competitive sector, and a state sector. In comparison with the modem urban sector and with export agriculture, firms in the competitive sector are small, low-profit, and low-wage enterprises that employ rudimentary, labor-intensive production technologies, operate in competitive markets, and demonstrate very little productivity growth. Political legitimacy and social stability entail reducing or suppressing disaffection and political unrest, primarily by workers in the export agriculture and competitive sectors and occasionally in the modern urban and state sectors as well.
