Underdevelopment in Jamaica: An Institutionalist Perspective

Abstract

Despite constant postwar efforts to decipher the development process, it appears that little practical progress has been made. Many theories have been proposed (some leading directly to policy), but very few countries have succeeded in breaking the bonds of underdevelopment. This characterization fits Latin American and Caribbean (LAC) countries especially well. In LAC countries, the prescription most aggressively pursued has been industrialization. The assumption underlying this approach is that a declining sectoral share of agriculture and agricultural employment will lead to rising per capita income. For the most part, significant structural transformation was achieved, and today it is not uncommon to find LAC nations exhibiting high degrees of industrialization and a labor force that is divorced from the agricultural sector. In Jamaica, for example, between 1930 and 1990, the share of agricultural employment fell from an average of 60 percent to 11 percent, a decline that proceeded over 125 years in many of the currently developed nations. Yet, the expectation of consequent high wages and full employment has proved unfulfilled. Two kinds of explanations have emerged from this frustration: those based on free market principles and those focused on specific social, historical, or political phenomena as the culprit. Using Jamaica as our subject, we take a somewhat different approach. Our argument is that the island's lack of development is a reflection of powerful institutional forces acting to shift economic activity away from democratic problem solving and toward invidious distinction and conspicuous consump-