This, thus, constitutes the third indivisibility.
The result is that the incentives to invest are increased. A big thrust of a certain minimum size is needed in order to overcome the various discontinuities and indivisibilities in the economy and offset the diseconomies of scale that may arise once development begins. Moreover, these services are only indirectly productive and involve long gestation periods.
This is on the implicit assumption that these services are totally non-existent in these economies. If the industry A expands in order to overcome the technical indivisibilities, it shall derive certain internal economies. But in the developing countries, the most dominant sector is composed of agricultural and primary production.
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A certain minimum of initial speed is essential if at all the race is to be run. Thus, due to the inherent capital scarcity in the developing countries, it is really a matter of dubious wisdom to require these countries to overstrain their meagre resources in the provision of a complete outfit of infrastructures.
Cost escalations may even cause projects to be postponed and the development process in general to slow down. The crux of this theory is that the obstacles of development are formidable and pervasive. This is a challenging task for the governments of developing countries. All errors are my own responsibility.
This is not achievable by mere establishment of a few industries, but requires a large program of industrial growth.