The combined effects of distance and the very

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The combined effects of distance and the very restrictive nature of immigration laws in modern developed countries o Comparison: Over 60 million people migrated to the Americas (a major outlet for excess rural populations) between 1850 and 1914 o Note: Many of the people who migrate from poor to richer lands are the very ones that developing countries can least afford to lose: the highly educated and skilled. Remittances were an extremely important resource The Growth Stimulus of International Trade: o Despite recent gains, the free trade that propelled the development of today’s economically advanced nations has not assisted today’s LDC in the same way. o For decades after WWI, many developing countries experienced declines in their terms of trade (price of exports compared with price of imports) Basic Scientific and Technological Research and Development Capabilities: o When now developed countries were embarking on their early growth process, they were scientifically and technologically ahead of the rest of the world o Poor countries have neither the financial resources nor the scientific and technological know-how to undertake the kind of research and development (R&D) that would be in their best long-term economic interests o Research funds are spent on solving the economic and technological problems of rich nations Efficacy of Domestic Institutions o Poor institutions facilitating extraction rather than providing incentives for productivity were often established by colonial powers o States typically emerged more organically over a longer period than say Africa, where national boundaries were more arbitrarily dictated by colonial powers – leads to less political stability
Are Living Standards of Developing and Developed nations Converging?
What is actually happening:
o

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