ABSTRACT
Orthodox economists believe that the growth of the service sector in the advanced capitalist system reflects consumers' higher income elasticity of demand for services. However, specialists on developing countries, such as Gunnar Myrdal, have noted that the service sector in underdeveloped countries is frequently bloated with urban refugees from the countryside. Thus, the growth of the "service glut" tends to stem from the supply side rather than the demand side of the labor market. Comparisons of the growth of the service sectors in the advanced capitalist and the advanced socialist economies throw some light on the question of the laws of motion underlying the development of services system. The recent rapid growth of the U.S. labor force and labor participation rate, and especially the growth of employment in services, has certain demographic bases. In the United States, young people have been meeting the challenge of finding employment by participating in the explosive growth of the service sector.
