By Austin Robinson
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Extra info for Appropriate Technologies for Third World Development: Proceedings of a Conference held by the International Economic Association at Teheran, Iran
It needs to be borne in mind, moreover, that machinery and manufacturing equipment represents in many cases only a half or less of the total capital employed by a firm. In some cases analysed by teams working at the David Uvingstone Institute at the University of Strathclyde, the capital embodied in machinery and equipment varied from 25 to 55 per cent of the total capital; that invested in buildings varied from 7 to 20 per cent; the investment in working capital represented 30 to 70 per cent of the whole.
And J. E. Stiglitz (1974), 'Benefit-cost Analysis and Trade Policies', Journal of Political Economy. Diamond, P. A. and J. A. Mirrlees (1976), 'Private Constant Returns and Public Shadow Prices', Review of Economic Studies. Dixit, A. K. (1968), 'Optimal Development in the Labour Surplus Economy', Review of Economic Studies. Harris, J. R. P. Todaro (1970), 'Migration, Unemployment and Development: A Two Sector Analysis', American Economic Review. Leibenstein, H. (1957), 'The Theory of Underemployment in Backward Economics', Journal of Political Economy.
For the latter the cost of equipment would be minimal. On the other hand the 'labour-intensive' technology turned out to be more capital-intensive per unit of product when account was taken of the costs of housing the labour-force, and providing a minimum of facilities and social services. The 'labour-intensive' technology was at the same time much more management-intensive and at that time India was seriously short of top-management. It involved, moreover, making suitable provision for the greater volume of management required.