The Issue Of Insufficient Capital Accumulation In Developing Countries

Abstract

This research aims generally to analyse the issue of insufficient capital accumulation in developing countries. To develop the research and reach its objective, firstly, an analysis on the reason why there is insufficient capital accumulation in developing countries was made and, posteriorly, an efficient alternative to accumulate sufficient capital for economic development in these countries was presented. An analysis was also made of the social and economic situation of the countries taking into account their per capita income and human development index in order to classify economically and socially them at an international level. To understand the research topic, a general literature review was carried out on the concepts and theories that describe capital accumulation in general and particularly in the context of economic growth and development of countries. To collect data, data acquisition methods were used, based up on the secondary data acquisition technique, which consists of acquiring data from publications by public and/or private institutions. Therefore, the data used were obtained from the electronic databases of the World Bank Group and other private institutions. It was concluded that the issue of insufficient capital accumulation in developing countries is related to insufficient savings that arises because most of these countries have low and lower-middle incomes economies. The way to accumulate sufficient capital in developing countries is to consistently make foreign capital investments in these countries.