ABSTRACT
Near the end of Chapter 4, the simple neoclassical economic growth theory, the Solow model, was introduced. The model has been interpreted as predicting that the per capita incomes of economies would tend to converge to the same
level over time, as lower income nations grew faster than higher income nations, assuming they all had access to the same technology and shared similar saving and investment rates.1 Solow’s theoretical structure lent credence to and validated the policy recommendations of many of the early developmentalist economists and their policy-oriented theories, like the ‘big push’, ‘balanced growth’, and ‘unbalanced growth’ strategies considered in Chapter 5, strategies that focused on the expansion of the industrial capital stock and the rate of savings as the instrumental means to promote economic growth and higher income per capita.
