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p Colonialism put an indelible stamp on the structure of the geographical distribution of capitalist production. An evergrowing concentration of production capability in the comparatively few centres of imperialism and its slow growth in the overwhelming majority of the dependent agrarian countries and raw material producers was a major feature of the whole preceding colonial history of capitalist production. In disclosing one of the important aspects of the operation of the law of the unequal development of capitalism, Lenin remarked:

capitalism develops unevenly and objective reality gives us highly developed capitalist nalions side by side with a number of economically slightly developed or totally undeveloped, nations.  [105•1 

In addition, as wo have already noted, there began to be certain shifts in this relationship after the war because of the breach in the imperialist powers’ monopoly position. Graphs summarising the long-term trends in growth of these two groups’ GDP over recent decades give a very broad picture of this (see Fig. 5).

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p The immense unevenness of the development of separate regions and countries on the one hand and their industries on the other is not obvious in the dynamics noted. This unevenness will be analysed from the standpoint of changes in the structure of the distribution of the productive forces by the principal geographical regions, groups of countries, and countries of the two major sub-systems of today’s capitalist economy in the following sections of this chapter. Here we shall bring out the most general shifts to date in
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500- Indices of capitalist and developing countries’ production of GDP (1950=100) 450- 400- 350- 300- 250- 200- 150- 100 &Lcirc; 1950 * Estimated Sources: calculated from the UN Yearbook of National Accounts Statistics, Statistical Yearbook, and Monthly Bulletin of Statistics for the relevant years.
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the distribution of GDP between these two sub-systems. They give a very clear picture of how the economies of developing countries began to grow more rapidly than those 107 of the developed countries in the postwar period, especially in the mid-60s.

p This has been happening on a considerable scale of late because of the distinct slowing of economic growth rates in the metropolises of capitalism during its world crisis of the mid-70s. Growth rates also slowed rather, in turn, in the developing countries under the impact of the crisis, but there they were nevertheless relatively higher on average than in capitalist countries, which could not help intensify the trend toward a faster growth of GDP in the former than in the latter shown in the graph.

p This trend has become quite stable, and is showing itself in fact (though far from evenly) both in all their main industries and in the services and circulation sphere. Its action brings out a very important feature not only of the current shifts in the distribution of the capitalist world’s productive forces associated with the break-up of the colonial system but also with possible prospective ones.

p Study of this trend, however, without clarifying the specific character of its movement by industries, is clearly inadequate to characterise the patterns promoting probable changes in the future. From that point of view a comparative analysis of the structure and long-term dynamics of the growth of production in industries on the one hand and in the circulation and services sphere on the other, by the two groups of countries, is of great interest. The facts indicate that for all the diversity of their growth rates, the circulation and services sphere, etc., developed much faster in the agrarian countries (in contrast to the industrial ones) than the industrial sphere. As a result the proportion of the circulation and services sphere in the total gross production of developing countries rose roughly from 37.5 per cent in the early 50s to 44 per cent at the beginning of the 80s, while there was a slower development of this sphere on the whole in the industrialised countries, with the exception of periods of world cyclic crisis which, as a rule, bore most heavily on industrial production.

p The trend toward faster growth of material production on the scale of the world capitalist economy noted above, however, operated mainly only before the world crisis of 1974- 75, and stemmed basically from the features of the impact at that time of the scientific and technical revolution on the economies of the capitalist industrial centres. The structural 108 shifts emerging in the periphery developed in another direction; the circulation and services sphere expanded there much faster than the branches of material production. This difference of direction within a single system is an interlocking of aspects of the processes that are common to the whole system. In this case they include (in our view) not only the initial breaking down of age-old backwardness in sectors that form the infrastructure of the economies of former colonies and semi-colonies (railways, communications, etc.) but also the progressing impact of the scientific and technical revolution on the infrastructure of the world capitalist system as a whole. It is under its direct impact that the picture of the level and growth rates of production has begun to change, important changes are developing in the principal items of society’s material and technical basis, and its sectoral proportions and the ratio between its productive and non-productive spheres are altering. The revolution is furthering advance of some sectors along the line of scientific and technical progress and a slowing of the development of others.

p The steady deepening of the main contradictions of world capitalism in the 70s and early 80s, which was marked by a general slowing of economic growth within its limits, led to a sharp intensification of the instability and imbalance in the development of capitalist countries’ social production. The stimulating effect of contemporary scientific and technical progress on the economy (above all on the leading industries) clearly weakened, and there were very substantial shifts in those years in that connection in the sectoral structure of capitalist and developing countries (and so in the whole system of their world economic relations) on a scale unknown in preceding decades.

p In the summary analysis of the postwar structural changes leading to a raising of the weight of the circulation and services sphere in the gross production of capitalist and developing countries, the following facts primarily draw one’s attention. Transport and communications stand out specially in both groups of countries. In 1960-81 alone their volume of production in the industrial centres increased by a little more than 140 per cent, and by nearly 250 per cent in the developing countries. As a result their weight in the GDP of each group converged, rising respectively from C.O to 6.5 per cent in the capitalist countries and from 109 rouglily 4.5 to 5.5 per cent in tho developing countries.

p Although the proportion of transport and communications still remains comparatively low, its dynamics are very informative. It is in them that the tendency in today’s capitalist world toward a certain smoothing out of the marked imbalances in the structural relations of the various sectors of the GDP between developed and developing countries is making itself felt.

p This tendency began to become noticeable in the postwar period to one extent or another in almost all the principal sectors creating goods and services, including those that used to be decisive in characterising the underdevelopment of the colonial world’s economic structure.

p This underdovelopmeiit showed particularly clearly in those sectors outside the sphere of material production that are lumped together in the general concept ‘services’. In the early 50s they accounted for 35 per cent of the aggregate
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Table 7 Sectoral Structure of the GDP of Capitalist and Developing Countries (in percentages) Sector Capitalist Countries Developing Countries 1950- 1951 1970- 1971 1980- 1981* 1950- 1951 1970- 1971 1980- 1981* All 100 100 100 100 100 100 Material production 44.5 45 42.5 62.5 60.5 56 industry 28.5 32.5 32.5 22 33 32.5 agriculture building 8.5 7.5 5 7.5 4 6 36 4.5 22 5.5 17.5 6 Circulation & ser- U M vices 55.5 55 57.5 37.5 39.5 44 transport & communications 6 6.5 6.5 4 5 5.5 trade & commerce 15 15 15.5 14.5 14.5 15 others 34.5 33.5 35.5 19 20 23.5 * Estimated Sources: UN Handbook of World Development Statistics, 1979 (United Nations, New York, 1980); UN Yearbook of National Accountts Statistics, Statistical Yearbook, and Monthly Bulletin of Statistics for the appropriate years.
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GDP of developed capitalist countries. The corresponding indicator for developing countries was only a little more than 110 20 per cent. Subsequently this gap began gradually to close. Changes like that do not yet, of course, enable us to characterise the depth of the remaining backwardness of the structure of the economies of developing countries thoroughly and fully enough. The fact, for example, that the proportion of commerce in their GDPs was approximately the same as in the industrial centres of capitalism is by no means evidence that they have achieved as significant a degree of development in this respect. We also have to allow for the absolute volume of production of each sector in the one group and the other, the size of the population, and the level of labour productivity (which we shall touch on below). A comparative study of these structural shifts, however, enables us to size ,up many of the important features of the postwar development and distribution of the productive forces on a very broad plane. As we develop the main theme of this chapter they will be consistently analysed more concretely and more exactly defined.

p In this respect to describe the changing role of industry is of the greatest significance. The growth rates of industrial production in both groups of countries are higher than those of their social product; consequently the weight of industry in the GDP of industrially developed countries for the periods in Table 7 had a tendency to grow a little in the 50s and 60s, while it rose by 50 per cent in the peripheral countries. In the following decade, however, due to the two economic crises, the annual growth rates of industry did not rise An the first group, while the corresponding indicators were even lower in the aggregate growth of the GDP of the second group. As a result the proportion of industry in their gross production of goods and services roughly flattened out and was around one-third at the beginning of the 80s.

p The longer-term trend arising in the postwar period toward a reduction of the imbalance in the structure of production between the two main sub-systems of the world capitalist economy had thus begun to show more pronouncedly in industry than in the circulation and services sphere.

p In spite of the remaining wide gap in levels of industrial development, analysis of the current processes, that are making a further undermining of the colonial foundations of the capitalist system inevitable, allows us to suggest that this convergence will probably increase. One can 111 foresee, in particular, that the difference in the weight of industry in the GDP of the two groups created in earlier stages of the genesis of world capitalism will be narrowed still further in coming years. In some industries, however, there may be a significant coming together in this century.  [111•1 

p The same line is discernible to some extent in agriculture for all its extremely specific character and peculiarities. In both groups there has been a parallel and quite marked fall in recent decades in the weight of agrarian produce in their aggregate social product. The proportion of agriculture in the GDP of developed capitalist countries fell from 8.5 to 4 per cent, and in developing countries from 36 per cent to less than 20 per cent.

p The indicators cited include the results of very intricate socio-economic processes and could undoubtedly be taken as the starting point for a special comparative study of the real shifts that are becoming noticeable in the agriculture of these groups. But they already provide an opportunity in their present form to make certain generalisations of a factual order needed for further analysis.

p During the whole preceding colonial development of capitalism, a decisive part of the aggregate product of its periphery was, as we know, created in agriculture, which was a natural consequence of the underdevelopment of the social production of the colonies and semi-colonies. This underdevelopment was further deepened by the fact that the colonial authorities saddled them with the role of economic appendages of the metropolitan countries. Their agrarian production was forcibly oriented on supplying the centres of capitalism with produce at the expense of their own consumption, so that while agriculture was the main occupation of the bulk of their populations, hunger and poverty prevailed in them, which was one of the most pernicious consequences of the transformation of capitalism into a world economic system.  [111•2 

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p By the middle of the twentieth century the gap ih this sphere between the metropolitan countries and their agrarian, primary commodity producing appendages had attained colossal proportions. The weight of agriculture in the latter’s GDP was then almost double that of industry and constituted nearly 90 per cent of the value of the production of all sectors of the circulation and services sphere put together. In the metropolitan countries, however, the weight of agriculture was correspondingly roughly a quarter of that of industry and 87 per cent less than the proportion of the services and circulation sphere. Since then there have been notable changes in the structural proportions, which is very important to allow for not only when estimating the shifts that have already occurred but also when calculating probable coming shifts in the distrubition of the world economy’s productive forces.

p As for the developing countries, it is worth noting that agriculture, whose share still considerably exceeded that of the industrial product at mid-century, has since finally and irrevocably fallen to second place behind industry. There are real grounds for predicting a further change in this respect. In our estimation the line of development noted may lead to the weight of industry in the GDP of developing countries being at least double that of agriculture by the end of the 80s. Their lag behind the industrialised countries, however, will still undoubtedly be very considerable then, since the industry/agriculture ratio in the latter was already estimated at around 8.5 : 1 in the 70s, and will probably not be less than 9 (10) : 1 in the 80s.  [112•1 

p Comparison of the long-term trends of development of industries and direct services also leads to not uninteresting estimates of the changes occurring, or anticipated in the future, in the structure of the GDP of the two groups of 113 countries. According to them the ratio between agrarian production and the services sphere, for instance, steadily changed in favour of services in the economic centres of capitalism. At the beginning of the 80s 14 times more commodities were produced in it (in terms of value) than in agriculture.

p A similar process, but at a qualitatively different level, was observable in the last decades in the former colonial world as well. Even at the beginning of the postwar period the share of services in the aggregate product was around 60 per cent less than that of agriculture. Three decades later it had already risen much above the latter. To all intents and purposes, however, the services sphere will retain a clearly marked tendency everywhere in the foreseeable future toward priority development compared with agriculture, probably with accelerated growth rates where the backwardness of the relations of production previously maintained by colonialism has long been an obstacle to its establishment and development.

p Comparison of the growth results of the other main spheres of material production (i.e. industry and the sectors constituting ‘services’) yields a diametrically opposite picture for the two groups. At the beginning of the postwar period the proportion of industrial production in the GDP of both of them (especially of the second group) was less than that of sectors belonging to the services sphere. But in recent decades the proportion of industry came noticeably closer to the aggregate share of the services sectors and later overtook them in both groups of countries. In other words, there was a smoothing out in this respect, too, of the acute imbalances in the structure of social production in both groups with the decay of the colonial system, while the one preserved its immense superiority over the other as regards level of economic development.

p We shall shortly demonstrate below how the structural proportions between the principal industries within each group gradually altered after the war, but already, on the basis of the facts cited, we can conclude that, in spite of the extremely broad variety of the trends of socio-economic development, the determinant features of the postwar dynamics of the growth of social production in the countries taken separately, and the structure of the distribution of production created by capitalism between its industrial 114 centres and agrarian periphery, are beginning to undergo fairly important changes.

p Relatively more favourable conditions are now taking shape in the present international situation for developing
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Fig. 0 Share of capitalist and developing countries in the principal sectors of the world capitalist economy’s production of GDP (in percentages) INDUSTRY ACiRICULTURE BUILDINGS TRANSPORT A THAUE CONSTRUCTION COMMUNICATIONS si.nvir.t s 100 CAPITALIST COUNTRIES ’///, DEVELOPING COUNTRIES * Estimated Sources: as for Fig. 5. 115
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countries’ successful struggle to eliminate their former dependence and the colonial direction of their economies, but in practice most of them are still only in the initial phase of this objectively inevitable, long, stubborn struggle, visible proof of which will be found in the estimates of the shifts in the distribution of production given in Fig. 6.

p As the graphs indicate, there has been a long-term trend in literally all the principal sectors forming the gross product of the non-socialist world toward an enhancing of the role of the production of developing countries. In the period covered by Fig. (> their share in the industrial output of the capitalist economy has increased by roughly 75 per cent, in building and construction has doubled, in transport and communications has risen by a third, in services by twothirds, and in trade by more than a quarter. That does not, however, mean any kind of fundamental break in the longstanding extreme unevenness of the distribution of production capacities between industrially developed countries and the primary producers in the present day capitalist economy. In all its principal sectors, except agriculture, five to seven times as much output originated in the metropolitan countries at the end of the 70s as in the developing ones.

p Even the indisputable fact that the developing countries surpassed the main economic centres in volume of farm production does not give us the right to consider there to have been any kind of essential turn in the distribution of the productive forces. Furthermore, it is agriculture that is still, as a rule, the most backward sector of their economies, which to a crucial extent determined the steady widening of the gulf between them and the developed countries in per capita gross production.

p It is of paramount importance in this connection to analyse the regional distribution and long-term dynamics of population growth. This analysis, being a sine qua non of a comprehensive study of the distribution of the productive forces, also calls for an all-embracing systems approach. The next section of this chapter will be given over to it, which will enable us to present the socio-economic aspects of this problem more fully and clearly. But before we pass to a comparative description of the demographic structure of the capitalist economy by regions and groups of countries, we must dwell on at least one more matter of first-rate importance.

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p So far the objective has been to delineate the general contours of the dynamics, scale, and distribution of the gross domestic product in terms of capitalism’s two principal groups of countries. At this very high degree of statistical abstraction we must not lose sight of the following point: each of the aggregate sectors considered in itself is an extremely complex system embracing at least several major lines of production which in turn are built up from ever more specialised groups of industries.

p Within industrial production as a whole we primarily distinguish such very broad, large-scale sectors as manufacturing, generation of electricity, and mining, each of which can be pictured as a kind of sub-system within the aggregate, consisting of smaller sub-systems. Manufacturing, for example, is broken down into the steel, metalworking, chemical, textile, food, and other industries, which again include more specialised industries.

p The logic of a macro-economic study is therefore the same in this case—from broad generalisations following from highly synthesised data to their elaboration and itemisation by analysing the main trends in the movement of the separate sub-systems in their interaction and subordination. It is through this approach that we get the opportunity to determine the specific features of the development of the part in the world economy concretely compared with, and integrally connected with, the principal channels of movement of the whole.

p Even from that standpoint the conclusions drawn earlier about the shifts in the distribution of production between the industrialised countries and the agrarian and raw material appendages must consequently be elaborated, deepened, and so made more complicated. If we consider, for example, that the mining, electricity generating, and manufacturing industries comprise the three most important parts ( subsystems) of industrial production in general, then the resultant trends of its development over recent decades can be summarised in the index numbers of Table 8, which in the final analysis reflect the main lines as well of the impact of scientific and technical progress on industry and at the same time are evidence of the rise within industry of qualitatively new phenomena and contradictions.

The figures referred to graphically illustrate the longterm line of the changes in the industrial structure of modern 117 world capitalism, and in the distribution of the most important components of industry in the two main groups of countries; while enabling us to represent the scale and general picture of these changes more distinctly, they at the same time provide the factual basis needed for comparative study of the various sectors of the economy in the separate groups. Among the various processes noted in Table 8, the everincreasing differentiation of growth rates among the mining, power, and manufacturing industries merits special attention. Mining grew at the lowest rates after the war, with a consequent lowering of its proportion in the total volume of industrial production from roughly 11 per cent at the end of the 30s to 6 per cent at the end of the 70s. But the fall occurred mainly in the industrial centres. The developing countries, on the contrary, had unprecedentedly high growth rates in extraction of minerals, primarily of fossil fuel. As a result from 1960 to 1980 their share in the mining of the non-socialist world rose steeply; roughly from twofifths to more than three-fifths.

Table 8 Weight of the Basic Industries of the Two Groups of the World Capitalist Economy (in percentages) Industry Capitalist Countries Developing Countries 1960- 1961 1970- 1971 1980- 1981* 1960- 1961 1970- 1971 1980- 1981* Manufacturing 91 89 86 9 11 14 Mining 57 42 39 43 58 61 Power (electricity, gas) 93 91 87 7 9 13 * Estimated Sources: UN Handbook of World Development Stnlisticx 1979; UN Statistical Yearbook and Monthly Bulletin oj Statistics for the appropriate years.

p The most dynamic trend of industrial development in both groups was in the power industry, whose average growth rates were more than double those of manufacturing and four times as high as those of mining (which could not help raising its role). The proportion of the output of the power industry in all total industrial output, in comparable indicators, was around 3 per cent on the eve of World War 118 II and is now more than 8 per cent. The power capability of the developing countries lias heen expanding particularly fast; in the 60s and 70s alone it rose by roughly 500 percent. In spite of that, however, their industrial production of power was still rather less than one-seventh that of the capitalist countries at the beginning of the 80s.

p The difference between the two groups has remained even deeper, on the whole, in manufacturing, in which the weight of the developing countries has remained very low, even though it has increased slightly. At the start of the 80s it was roughly 14 per cent against 9 per cent at the beginning of the 60s. The weak development of manufacturing is the main reason for the preservation of many features of the old colonial structure in the distribution of the productive forces of present-day capitalism and the backwardness of all the other spheres of the economy involved in creating the former colonies’ aggregate social product.

p With a further deepening of systems analysis of the shifts in the distribution of the aggregate product between the two groups of countries in each of the sectors of production, we can distinguish major sub-systems, as in industry. In agriculture they include primarily the production of food on the one hand and of industrial raw materials on the other, which in turn consist of more specialised groups of industries (crop growing, animal husbandry, etc.).

When making a comparative study of the cardinal problems of the distribution of any industry, however, we must always ask what is the relation between the dynamics of production of the respective product in the different groups of countries, and the size of their populations and manpower.