ENDOWMENTS, MIGRATION AND ECONOMIC DEVELOPMENT: AN ADAPTIVE MODELLING APPROACH (DISEQUILIBRIUM, SATISFICING)

The broad objective is to study the process by which agents in less developed countries (LDCs) advance economically. A theoretical elucidation is provided which falls within the domain of economic decision-making in the presence of scarcity--particularly, the scarcity of information.; The dissertation accounts for the institutional character of LDC economies and ties it to the role of ethical values in formulating decisions. A case is made for regarding efficiency as context-sensitive. The meaning of economic endowments is explained. It is argued that the traditional characterization of endowments is incomplete without an explicit inclusion of know-how, energy and materials (KEM), which are rigorously defined. Indeed, it is KEM that propels an agent toward economic development.; The dissertation then turns to migration phenomena. In particular, return and repeat migration since, in the opinion of this author, a definitive explanation has not been provided using traditional tools.; The hypothesis advanced in this thesis is that know-how crucially determines return and repeat migration. This hypothesis is formulated on the basis of the adaptive-feedback model constructed to reflect typical characteristics of LDCs. Conventional models can be misleading for they do not deal directly either with the potential migrant's decision process or the dynamic mechanism of disequilibrium transitional states.; The model yields the following results: (1) The impact of increases in urban employment may be negative in the presence of low levels of know-how. (2) An individual's reaction to failure experiences may yield a subjective probability of failure that is too high, which in turn suggests that he/she may not respond positively to small increases in employment. (3) High levels of know-how are necessary to obtain conventional results of received theory. (4) When know-how is sufficiently high the agent is likely to succeed which, in turn, means that he/she is likely to repeat this experience to yet another location.; Finally, in order to reach his aspiration level, the agent needs a strategy that will lead to the desired target. Thus, the adaptive-feedback model is proposed as the transformation theory that represents the mechanism involved in pursuing the agent's purpose.