The Distribution of Benefits from Industrialization in Rural Areas: Some Findings

Abstract

Industrialization has long been proposed as a policy for promoting regional economic growth and reducing the incidence of unemployment, poverty and dependency in lagging regions (Smith). Such policy proposals are based on the trickle down theory. This theory holds that economic development results in an increase in the demand for skilled labor which in turn results in an upgrading of the positions of the semiskilled, unskilled, and unemployed. The result is economic growth and a reduction in the incidence of unemployment, poverty and dependency and the degree of income inequality in the area.