123
unfortunately it can be used as a gateway to lower production costs in conventional
practices. This type of practice is common in least developed/developing countries
given the intense job competition, unbalanced power relations and asymmetric
information. In this sense, the evolutionary perspective seems able to explain the
insight of fair trade initiatives in terms of social entrepreneurship, whose limitations
can be addressed to advance the necessary social change agenda.
9.2.2 Evolutionary Economics and Developing Economies
Constraints to Be Overcome
Given the challenging characteristics of developing or underdeveloped countries,
the approach of evolutionary economics when it integrates change appears to meet
a basic non-excludable condition for understanding the dynamics of the underdeveloped/developing economies. There is a trend of simply addressing non-developed
countries as developing countries – this use is followed in this study whenever possible. However, the term underdeveloped was of common use when some articles
used as reference here were published; in this case the term “underdeveloped” is
kept, with no derogatory stress to one or another. When considering economic models, classical and neoclassical economic analysis are not sufficient in explaining
underdeveloped countries’ economic challenges as they focus on market equilibrium and optimal conditions for operating markets.
Meeting Pareto Optimal conditions is far from feasible for underdeveloped economies, whose characteristics are remote to optimal equilibrium and skip objective
economic laws. Foster and Metcalfe (2012) contribute to outlining underdeveloped
economies features such as realities of strict markets; bounded rationality; institutions poorly developed; uncertainty; and economic knowledge incomplete.
Following this analytical pathway could diversify the economic approach to such
realities. Underdeveloped/developing economies characteristics are endogenously
related to uncertainty and instability of markets. In such contexts, possible achievements of fair trade initiatives – which bring together developing and developed
economies in a viable trade model – can be understood.
As “evolutionary theories place the diversity of behaviour, rather than the uniformity of behaviour” (Foster and Metcalfe 2012, p. 422), it seemed appropriate to
stress those categories as a framework in this analysis. Uncertainty – a constitutive
part of those economies – has the potential to bring a positive effect as such characteristic is a great field to innovation, according to Schumpeter (Schumpeter 1939;
Dopfer 2011). In the same extent, predictability may not apply to those underdeveloped or developing countries, exactly because the history of their market behaviour
does not always dispose of a stable or predictable pattern to allow forecasting. This
feature may largely undermine investors’ interest and consequently credit availability, leaving to these countries a marginal role to advance their productive processes
and to participate in international trade.
9 SDG 8 Decent Work and Economic Growth
unfortunately it can be used as a gateway to lower production costs in conventional
practices. This type of practice is common in least developed/developing countries
given the intense job competition, unbalanced power relations and asymmetric
information. In this sense, the evolutionary perspective seems able to explain the
insight of fair trade initiatives in terms of social entrepreneurship, whose limitations
can be addressed to advance the necessary social change agenda.
9.2.2 Evolutionary Economics and Developing Economies
Constraints to Be Overcome
Given the challenging characteristics of developing or underdeveloped countries,
the approach of evolutionary economics when it integrates change appears to meet
a basic non-excludable condition for understanding the dynamics of the underdeveloped/developing economies. There is a trend of simply addressing non-developed
countries as developing countries – this use is followed in this study whenever possible. However, the term underdeveloped was of common use when some articles
used as reference here were published; in this case the term “underdeveloped” is
kept, with no derogatory stress to one or another. When considering economic models, classical and neoclassical economic analysis are not sufficient in explaining
underdeveloped countries’ economic challenges as they focus on market equilibrium and optimal conditions for operating markets.
Meeting Pareto Optimal conditions is far from feasible for underdeveloped economies, whose characteristics are remote to optimal equilibrium and skip objective
economic laws. Foster and Metcalfe (2012) contribute to outlining underdeveloped
economies features such as realities of strict markets; bounded rationality; institutions poorly developed; uncertainty; and economic knowledge incomplete.
Following this analytical pathway could diversify the economic approach to such
realities. Underdeveloped/developing economies characteristics are endogenously
related to uncertainty and instability of markets. In such contexts, possible achievements of fair trade initiatives – which bring together developing and developed
economies in a viable trade model – can be understood.
As “evolutionary theories place the diversity of behaviour, rather than the uniformity of behaviour” (Foster and Metcalfe 2012, p. 422), it seemed appropriate to
stress those categories as a framework in this analysis. Uncertainty – a constitutive
part of those economies – has the potential to bring a positive effect as such characteristic is a great field to innovation, according to Schumpeter (Schumpeter 1939;
Dopfer 2011). In the same extent, predictability may not apply to those underdeveloped or developing countries, exactly because the history of their market behaviour
does not always dispose of a stable or predictable pattern to allow forecasting. This
feature may largely undermine investors’ interest and consequently credit availability, leaving to these countries a marginal role to advance their productive processes
and to participate in international trade.
9 SDG 8 Decent Work and Economic Growth