New Strategies for Development: Poverty, Income Distribution, and Growth

Abstract

It is now widely acknowledged that growth of GNP, conventionally measured, is unsatisfactory as the main target of development strategy and as the sole criterion of its success or failure. Among the many reasons why this is accepted, two have been singled out. First, many developing countries that have experienced rapid rates of growth of GNP have also and simultaneously generated increasing amounts of unemployment and underemployment. The growth rate of employment in the modern sector has been much slower than the growth rate of GNP, and much slower than the growth in numbers seeking modern sector jobs. Secondly, rapid growth in GNP has often been accompanied by a more unequal income distribution and increasing relative and, in some cases, absolute impoverishment of sections of the community. GNP has been ‘dethroned’ mainly because it fails to incorporate any measure of a country’s success in achieving fuller employment and a more even income distribution.

This chapter is reprinted from Oxford Economic Papers, vol. 28, no. 3 (November 1976). We are indebted to Wilfred Beckerman, Robert Cassen, Richard Jolly, Amartya Sen, and Hans Singer, and to a research seminar at Queen Elizabeth House, for helpful comments.