This paper introduces a new concept – economic development through domestication of a geoclimatic zone, enabled by a special adaptation to its unique conditions. Development is thus seen not as a matter of choice. It is induced (or not) by demographic growth when the older zone and its unique economy fail to absorb and feed the growing masses. The paper shows that this new understanding explains many mysteries of development and international trade. Also, it allows for reconciliation of many feuding theories and models, bringing together, under one roof, the neoclassical school (Ricardo to Krugman), institutionalists (Veblen to North) and the long-waves adherents (Schumpeter to Freeman). We show the usefulness of this new concept in forecasting, using as an example China, which doesn’t fit any extant model of development.
JEL Codes: F02, F2, F4, F47, O11, O12, O13, O14, O15, N1, N2, L0, L1
- international trade
- East-West or North-South divide
- resource shortages
- economy of small series