Arthur Lewis Article Analysis Essay

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Nov 24, 2024

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1 Arthur Lewis Article Analysis Essay Student’s Name Institutional Affiliation Course Due date

2 Introduction Arthur Lewis is one of the most significant economists of the 20 th century. Furthermore, he presented a well laid out strategy for a capitalist industrial development of the small countries found in the Caribbean region in his article titled “Industrialization of the British West Indies”. The article was published in the year 1950.He advocated that these small countries should move from the contemporary agricultural activities to industrial activities based on the use of local raw materials such as chocolate making, sugar refining and dairy products. He suggested this to create employment opportunities and also diversify on domestic production. In the essay, it will evaluate how these Caribbean economies have acknowledged Lewis’s proposals and also assess whether or not they are industrial economies. Body The Caribbean region has a history of agricultural production which was developed in the colonial era. Furthermore, the colonial economic policy also emphasized on the neo-mercantilist concept of comparative advantage which primarily focused on the export of products such as sugar to United Kingdom through the use of preferential trading prearrangement(Polanyi et al., 2022). Hence, the industrial development was not a main priority in this region and there was inadequate infrastructure and also on the policy framework in order to poster the industrial operations. Nonetheless, local politicians and other social commentators hugely advocated the overall need for having a capitalist industrial development in these small countries found in the Caribbean. His strategy also advocated for the use of raw materials locally to produce products for the local market and also on the export markets. He also noted that small countries found in the Caribbean can compete in the global market through producing products that are labor intensive and use the local materials in the process.

3 Despite having the advocacy for industrial development, these economies’ shift from agriculture to industry was very slow. The region has a small and fragmented domestic market that could not support various medium and large scale operations (Polanyi et al., 2022). Furthermore, the lack of industrial skills and capital also hindered the industrial development for the region. The government offered the necessary infrastructure that include roads, electrical systems, ports and water. It also implemented policies that were aimed at expanding the industrial operations. Nonetheless, the industrialization in this region remained mixed. The industrialization journey in the Caribbean also varied from country to country. Countries such as Trinidad, Barbados and Jamaica were very successful when it comes to developing the manufacturing sectors. The petrochemical industry which includes Trinidad, Barbados’s tourism industry and the bauxite industry in Jamaica, it was the most successful industry that contributed to the economics’ growth. Furthermore, some countries that include Haiti, St. Lucia and Grenada were lesser in their industrialization efforts (Popovic, 2022). Despite the industrialization experience, the economies have made immense progress when it comes to diversifying the economies. Furthermore, the region have also moved away from the traditional agricultural exports to amenities, such as financial services and tourism. The service sector has turned out to be the dominant sector in the Caribbean countries which contributed to the GDP and employment sector. Why Caribbean Economies Should Diversify Their Economies The Caribbean countries should continue diversifying their economies instead of focusing only on the industrial development. Even though industrialization can generate employment and also contribute to the overall economic growth, it faces a few drawbacks that include environmental degradation, income inequality and displacement of workers(Popovic, 2022).

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4 Furthermore, the Caribbean region is small and highly fragmented in terms of domestic markets and this presents a challenge when it comes to creating economies of scale that is needed when it comes to competing in the global market. Through the diversification of the economy, we can provide the region with various economic activities which can reduce the overdependence on one single sector or product. Hence, the services sector has already become dominant in the Caribbean economies which contributed to the region’s GDP and employment. Furthermore, the region should also focus on the improvement of the service sector that include tourism, information technology and financial sectors Tourism is one of the most significant sector in these Caribbean economies which contributes to the total GDP and employment. Nonetheless, the region should also continue investing in tourism infrastructure, improve the quality of service and also diversify the product in order to attract more people and also generate huge foreign exchange earnings. The financial sector has also become very integral in the Caribbean economies which provides banking, financial services and insurance to the local and international markets. Furthermore, the region should also continue to regulate the framework and also strengthen the financial sector and resilience to the vulnerabilities of the sector.In the end, the information technology sector has a very huge potential in the region and other factors such as the COVID 19 pandemic have accelerated the adoption of the digital technologies. The region should also continue to invest in the ICT sector and also improve digital literacy and in the end promote entrepreneurship and high levels of innovation in the technological sector. Conclusion In summary, Arthur Lewis’s proposal for industrial development in the Caribbean region was acknowledged by the social commentators and local politicians. Nonetheless, the region is

5 small and fragmented, lack of capital and industrial skills prevented the transition from agriculture to industrial activities. Despite having a slow transition, the countries have been successful in developing their manufacturing sectors which contributes to the economic growth of the region. The region has made huge progresses in diversifying its individual economies and it has made the service sector a huge part of the region. Even though the region has not become a huge industrial player, the progress that has been made in diversifying the economies has directly contributed to the economic development of the region.

6 References Arthur Lewis and Industrial Development in the Caribbean: An Assessment: https://laprimaradice.myblog.it/media/02/02/776508438.pdf Nations. United Nations. Retrieved 13 July 2023, from: https://www.un.org/en/chronicle/article/w-arthur-lewis-pioneer-development- economics Polanyi Levitt, K. (2022). W. Arthur Lewis: Pioneer of Development Economics | United Popovic, C. (2021, September 21). The Arthur Lewis model. Caribbean Beat Magazine, available at: https://www.caribbean-beat.com/issue-19/lewis-model#axzz70d3wFNpz

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