In Limits to Capitalist Development, Weeks consolidates and extends his previous work on Peruvian industrialization which has appeared in various issues of Latin American Perspectives. His first objective is to expound a general Marxist theory of development as an alternative to dependency and neoclassical approaches. This takes up the first three chapters, one third of the book, and most readers of this journal will find it heavy going. The author provides a detailed critique of dependency theory and of unequal exchange, and argues that limits to development must be sought in factors internal to backward countries, not external to them. These internal factors are the social relations of production which should be analyzed within a framework best described as unreconstructed, orthodox Marxism. It would be inappropriate to debate here the more arcane points of Marxist value theory but two points should be noted. First, two apparently original arguments made here against the dependency and unequal exchange theorists were actually made over a decade ago by contributors to the journal International Socialism. Nigel Harris pointed out that the largest international capital flows occurred among advanced capitalist countries rather than between them and the Third World (see his essay in World Crisis—Essays in Revolutionary Socialism, N. Harris and J. Palmer (eds.), London: Hutchinson, 1971), while Michael Kidron showed that low wages did not necessarily imply a high rate of exploitation (see chapter 5 of his Capitalism and Theory, London: Pluto Press, 1974). Second, although this book is primarily concerned with the industrial sector, it suggests that the specific limit to capitalist development in backward countries is the rate of growth of productivity in domestic food production. This is a view shared by several non-Marxist economists such as Michael Kalecki and Sir Arthur Lewis.
Weeks’s second objective is to challenge existing interpretations of Peruvian development since 1950, and, in particular, to put forward a dissenting view regarding the nature of the military regime which held power between 1968 and 1980. He begins by examining the growth and changing composition of the manufacturing sector, and he analyzes the evolution of the industrial structure over time. He finds that there was no general trend towards increased concentration of ownership in manufacturing between 1963 and 1975, and suggests that there was no relation between the degree of centralization in an industry and either the extent of foreign ownership or the growth rate of output. He moves on to analyze the material condition of the working class and reaches three conclusions which do not seem wholly consistent. Workers in large firms are found to be more likely to strike than workers in small firms, and the frequency of strikes in an industry is shown to be the best single predictor of the industry’s average wage level. However, from 1963 to 1975, the average annual increase in wages was lowest for workers in the largest firms and highest for workers in the smallest firms. The apparent inconsistency between these results is not satisfactorily explained. Weeks then examines the impact of the ownership reforms introduced by the military regime between 1968 and 1980 and concludes that previous analyses have exaggerated the extent and significance of state ownership. His data suggest that, although the state owned approximately 35 percent of assets in manufacturing in 1973, it produced only 17 percent of gross manufacturing output. This is an interesting and (to me at least) surprising result. The volume closes with a brief chapter on the economic crisis of the mid-1970s, although there is no mention of external indebtedness.
The greatest strength of this book is its attempt to use the available time series on industrial structure and wage levels to test a series of hypotheses. Although I am not convinced by many of the econometric results, this volume is bound to stimulate discussion and further research in an important area.
Figueroa’s book is an expanded version of an earlier monograph which described the level and composition of household income and expenditure among eight peasant communities located in the southern sierra of Peru. Its expressed goal is to analyze “the specific forms [taken by] the economic and social relations between the peasantry and the rest of the economy” (pp. 1-2). In fact, this is misleading because the author also uses his information to address certain propositions, such as Schultz’s “Poor but Efficient” hypothesis, which concern intracommunity and intrafarm resource allocation. I will begin with the book’s positive features, and will then discuss its weaknesses.
The accounting framework presented to identify the income and expenditure flows of households is useful. It allows us to determine the extent of “foreign trade” of these communities compared with the rest of the economy. The analysis suggests that net money transfers to peasant households average less than 10 percent of annual family income. The variation between communities in sources of family income, expenditure on modem agricultural inputs, and the extent of family income inequality is also of considerable interest.
The book’s major weakness is its failure to deal with the substantive relevant literature which already exists. The reader is told that “the peasant economy constitutes a reality without a theory” (p. 1). It is difficult to take this assertion seriously, given the flood of writing on peasant households during the 1970s. This lack of awareness of other pertinent work leaves Figueroa vulnerable to serious methodological criticism. The author also fails to mention certain issues which economists working with similar material have found to be of considerable significance. For example, he takes the household or nuclear family as the basic unit for the control and allocation of resources. This conventional position now has to be defended against the critique that it conceals the key issue of the intrahousehold allocation of income and consumption as between men, women, and children. Again, it has been suggested that the coexistence of private ownership of livestock with communal ownership of pasture land leads to overgrazing, because the cost to an individual household of increasing its herd size by one animal is less than the cost to the community in terms of reduced pasture per existing animal. Figueroa does not discuss this, although it is central to any assessment of the social efficiency of a peasant economy. Despite his plausible conclusion that peasants are rational decision makers, it should be noted that Schultz’s hypothesis cannot be tested rigorously without a great deal more information, particularly on production inputs, than is available in this study.
The two additional chapters included in the English language version of Figueroa’s monograph switch the analysis abruptly from the micro- to the macrolevel, presumably to provide a broader context for the community case studies. The result is not satisfactory, and the author would have done better to relate his results to the microlevel work of some of those who are conspicuously absent from his bibliography. For example, are his findings on peasant household income sources consistent with those of Deere and de Janvry for Cajamarca? How do the strategies for overcoming risk and uncertainty which he discusses differ from those analyzed in detail by David Guillet for the Cuzco region? Have the richest households Figueroa encountered accumulated their wealth in a similar fashion to the successful petty entrepreneurs in the central sierra described by Long and Roberts? What does his discussion of reciprocity and labor exchange add to the findings of Alberti and Mayer’s volume? To what extent does access to off-farm income streams permit or encourage groups of peasants to split off from existing communities to establish new settlements in the southern highlands as Henri Favre has described for the central sierra? These questions need to be answered.
