ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Footwear- Export Problems

signals whenever distortions of a particular kind vitiate a country's pattern of growth. Most of these distortions are linked to the unequal distribution of wealth and opportunities in the system. Almost invariably, the tertiary sector for such an economy grows at a rate much faster than the overall rate of growth for it. This happens because a skewed income structure calls for a disproportionate expansion in the consumption of services. The so-called demonstration effect takes over at some point, and induces an abnormal rise in the marginal propensity to consume; as a consequence, the rate of savings is depressed, or at least is unable to rise as much as would be justified by the apparent increase in national income. Whatever the particular pattern of investment that is followed, it in effect means that, by and large, the creation of new jobs lags behind the actual demand for jobs, and the army of the unemployed tends to swell. Many amongst the latter, rather than be totally without any occuptaion, conceivably set themselves up in some sinecure work which passes as employment in services. This will be an area of low wages and low earnings; in the narrow technical sense, though, the people concerned will be considered as employed, and will be directly responsible for the bulge characterising the tertiary sector.

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