The Welfare Effects of the Introduction of New Products in Developing Countries

  • Jeffrey James


Thus far the analysis has been entirely static — the goods available, their prices and sizes have been taken as given for the analysis. But there is nothing inherently desirable about these. All are the result of past and present decisions made in specific economic, political and institutional contexts on behalf of, and with different implications for, the disparate socio-economic groups in society. Indeed, we shall argue that the result of these forces over time is in general such as to produce a systematically inegalitarian welfare impact in the context of less developed countries. This chapter provides a framework within which the welfare impact of new products on poor countries can be evaluated. The following chapter then provides evidence from the laundry soap and detergent market in Barbados to illustrate and support the argument.


Welfare Effect Rich Country Consumer Choice Efficiency Frontier Indifference Curve 
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Notes and References

  1. 1.
    New products developed in advanced countries are generally far more capital-intensive than the older products that they displace in developing countries. This will tend to reduce employment below what it might otherwise have been, increase technological dualism and increase urban concentration. For a full discussion see Frances Stewart, Technology and Underdevelopment (Macmillan 1977 ).CrossRefGoogle Scholar
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    In their study of social status among working class Africans in (what was then) Northern Rhodesia, Mitchell and Epstein found, for example, that success was demonstrated conspicuously by the ‘physical appurtenances’ of living, such as clothes, personal jewellery (especially wristwatches), furniture and European-type foodstuffs. See J. Clyde Mitchell and A. L. Epstein, ‘Occupational Prestige and Social Status Among Urban Africans in N. Rhodesia’, Africa, No. 29 (1959).Google Scholar
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© Jeffrey James 1983

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  • Jeffrey James

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