Chapter 5 Economic organization, information, and development

This chapter presents a discussion on the economic organization, information, and development. The chapter sets out the basic tenets of the theory and contrasts these with some alternative hypotheses. The chapter also discusses the theory of rural organization that attempts to describe the organization of economic activity within the rural sector. The chapter discusses the urban sector within less developed countries (LDCs). The chapter also describes the market equilibrium. The chapter describes recent research devoted to analyzing the consequences of alternative policies within this structure. The analysis in few areas is static, but the development process itself is dynamic. Thus, the chapter is concerned with growth, technical change, and entrepreneurship. The chapter presents some concluding remarks, including some observations concerning the role of the government in the development process from this broader perspective. The rapid improvements in agricultural technology during the past two decades mean that significant improvements in standards of living can occur without industrialization and urbanization. The LDCs thus face a choice about the appropriate path of development. A major source of the difference between developed and LDCs lies in the efficiency with which the available supplies of capital are used. The analysis of the appropriate role of the government is far more complex than traditional analyses.