Industrialization by Invitation Essay Example for Free

Industrialization by Invitation EssayDid Lewis theory of industrial enterprise by invitation (IBI) provide to some of the social, economic and financial problems universe experienced in the persona? Discuss your response. Lewis theory of industrialization by invitation made a case for the possibility of the creation of a manufacturing sector in the islands in the region, contrary to the ideas proposed by the Moyne Commission.With the overpopulation of the islands, Lewis argued that non-agricultural employment opportunities were required and he saw the manufacturing industry as a mover of achieving this goal. Using the theory of comparative cost, Lewis felt that industrialisation would be a viable option for the westward Indian islands. He noted, however, that given the fact that that local anaesthetics lacked adequate knowledge and were relatively inexperienced in this saucy endeavour, there would have to be a temporary reliance on foreign investors.To attract them, loca l governments would have to play a very active role by offering various incentives and panorama up Industrial Development Corporations. Lewis based his model on Puerto Ricos Operation Bootstrap. (Rose, 2002) states that by early 1960s the MDCs and some of the LDCs in the region had established the institutional and legal apparatus to nurse the industrialization development strategy. There was also an influx of foreign capital and visible light manufacturing industries (Rose, 2002).It would seem, therefrom that Lewis theory was successful since some economic growth was seen by the MDCs. Be that as it may, closer test would reveal that the smaller islands did not fare as well in their attempts at industrialization. In fact, steady with the success of the MDCs, industrialization by invitation achieved negative results. This was because most of the industries developed as a result proved to be capital intensive rather than labour intensive, thus unemployment rates remained high.T he increase in rustic to urban migration and the social and political tensions experienced did nothing to improve the situation. The foreign investors did not, as Lewis envisioned, offer competent training and assistance to the locals. Instead, they maintained close ties with their own countries and the region was now swept up in yet another cycle of dependency. Consequently, the implementation of Lewis strategy can be seen as having some heart and soul on some of the social, economic and financial problems experienced in the region.The fact remains that the countries in the region were forced to compete against each other for foreign investment thus undermining any previous attempts at integration, a situation which still exists today. Lewis strategy must not be thought of, though, as being wholly accountable for the regions problems. In part, this can be seen to have arisen because the regions governments, in implementing Lewis strategy, failed to take into account Puerto Ricos close ties with the United States and their privileged access to the U. S. markets.