ABSTRACT
The whole theory of consumer demand is quite inapplicable to poor but quickly developing countries; it is inapplicable because neither needs not tastes can be assumed as 'given'. The problem of the social cost of change can be disregarded in such a society only at much greater risk than in a rich and integrated one. Obsession with 'freedom for market forces' would cause far greater distortion and far greater waste of effort with far more ferociously unjust consequences, than in a rich country. Indeed, it might well imperil the whole development programme. After all, in these countries, development is superimposed on a mainly feudal system of land-tenure and agriculture in which the discrepancy between the wealthy and the poor is far more enormous. And where the conspicuous consumption of the former means an immediate impact on and weakening of the balance of payments, as the luxury goods which confer most prestige need to be imported.
