Heterodox Economics

Posted by admin on February 8, 2018 in Articles

Week6_constantino_jHeterodox economics refers to methodologies that are considered outside of the typically and well-known “mainstream economics,” often represented by correspondents as contrasting or going again neoclassical economics. There are numerous approaches and traditions to this subject. There are most definitely a handful of economists who portray a strong point of view from this topic, and are abrupt towards the subject. Some views of heterodox economics fortunately can be applied to and used in supplement to further explain and develop how an underdeveloped country can achieve industrialization and economic development. Two theories I feel that apply best to this argument are Paul Rosenstein-Rodan’s theory of hidden potential for economic development within less-developed regions, as well as Raul Prebisch’s theory of “development from within.” Both of these viewpoints portray strong aspects which could further help these nations prosper.
Paul Rosenstein-Rodan early on called attention to what he saw as hidden potential available within under developed nations. This potential he saw was a “big push” approach, which is said to be a series of concurrent industrial investments that could cause a chain reaction of investments, which would further positively ripple in many directions through the economic system. Rosenstein-Rodan began to speak of disguised unemployment, specifically in agriculture. He said workers who received very low pay, as well as produced little total output, should be put to work towards social overhead capital. He also discussed complementarity, and external economics, dealing with large-scale investments. He felt economic planning of limited nature would need to be accounted for, as well as targeting key industries or branches for optimal growth. Lastly, Rodan discussed technological external economics. This could potentially lead to a beneficial level of labor training that would have…