ABSTRACT
In chapter 2 the array of dynamic consequences of export expansion were discussed in some detail. It was noted that the critical initial transformation was the process whereby food and, later, processed food became commodities. Later, domestic markets for a very wide range of consumer and producer goods expanded dramatically as a result of the rising incomes associated with the growth of wage labour and the development of commodity forms of production. It was also noted that a significant part of this growing demand was met by imports, even though domestic demand was to some extent satisfied by increased domestic production. A category of forward linkages was identified, which included the development of a range of industries processing primary commodities. Finally, it was argued that there were a number of critical interconnections between the changing role of the state and the changing structure of colonial economies, but that serious constraints limited the degree and effectiveness of colonial state intervention: thus neither an accelerated expansion of export revenues, e.g. by diversification or processing of export commodities, nor the systematic development of the capacity to supply domestic demand from domestic production, was effectively fostered by state intervention.
