Lewis’s Breakthrough Publications of 1954 and 1955: A Little Understood Perspective

In August 1952, W. Arthur Lewis was walking down a street in Bangkok, the capital of Thailand, musing on a problem that had beset him for a long time. He did not understand why coffee fetched such low prices in world markets and steel such high ones, particularly because the coffee farmer and the industrial worker in the steel factory worked equally hard. Then it came to him, seemingly a Damascene revelation, that the differences between the wages of the steel and coffee workers were that the steel worker toiled in a labor-tight market, while the coffee farmer’s market had unlimited supplies of labor. Thus was born Lewis’s two major publications of 1954 and 1955, “Economic Development with Unlimited Supplies of Labour,” published in the Manchester School in 1954, followed by his 1955 book The Theory of Economic Growth. Both works were cited when the Nobel Prize in Economics was awarded to Lewis in 1979 and they formed most of what Lewis wrote subsequently, including two works also cited by the Nobel committee: The Evolution of the Economic Order (Princeton, 1977) and Growth and Fluctuations, 1870–1913 (London, 1978).