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To recap, the Lewis Two-Sector Model argues that reinvesting profit into new capital leads to capital accumulation, which causes economic growth. It is also assumed that there will be a bigger share of the modern industry in the total output, while the total share of the agricultural sector will decrease in time since it is remains constant.2 PROBLEMS in the LEWIS TWO-SECTOR MODEL1. It doesn’t make sense the capital owner will reinvest their profit in their own industry. For instance, if you have a capital flight and you put your money in Switzerland, then this will stop

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