The Formulation of Wage Policy

I make two initial assumptions in this paper. First, that we are talking about poor countries. Many problems of wage policy are in principle common to all types of economy. They take on a special quality in the poorer countries, however, not merely from the dual character of the latter’s economies and the distinctive attributes of their institutions and labour force, but particularly from the relative urgency of the policy’s context. In many ways, the term ‘developing countries’ which has been used to describe the economies with which the Symposium is presumably most concerned is a misnomer. These countries are in general to be distinguished from the advanced economies not just by the fact that their populations are much poorer, but by their slower development: if for instance, comparative growth is to be measured in terms of per capita real income, the average annual increase for the ‘developing countries’ as a whole is little more than half that in the advanced countries of the ‘industrial’ group — while a significant proportion of the poorer countries are not advancing at all in these terms, but are rather experiencing a decline as their population growth outruns the rise in the total real income of their economies.