Barriers to growth of less developed economies
Rapid population growth neutralises growth in GDP. The ultimate effect is that GDP per capita remains the same or comes down.
Human resources: Lack of training and high level skills makes the workforce less productive.
Lack of natural resources: If the country is lacking in natural resources, growth can be difficult. Moreover, if the country has good natural resources, but they are not managed properly then there will be less development.
Inefficient use of resources: If there is no optimum utilisation of workforce, or if the firms are inefficient due to lack of competition.
Too much dependence on agricultural products: Developed countries which import these products from less developed countries usually pay very low prices for it. Moreover, they further process these products and sell it for higher prices to LDCs.
Poor infrastructure: Lack of infrastructure such as poor transport and communication is another reason which hinders growth for LDCs.
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