be the greater because economic development, while leaving
large groups almost untouched, is going on all about them.

Jaffe's hypothesis, based not solely on Puerto Rican
experience, is that economic development (measured, for
example, by per capita income) can occur without neces-
sarily any increase in the volume of employment. This can
be seen readily in Puerto Rico where in recent years, the
population has been largely stationary for special reasons.
It is not so immediately visible where population is
increasing rapidly, and people must find employment of
one kind or another (i.e., underemployment) in a growing
labor force. Economic development must be rapid indeed
while population growth must not be too rapid, if (1)
per capita income is to rise and (2) if there is to be
sufficient change in industrial structure so that large
masses of peoples are shifted from the underemployment
of the traditional occupations. Otherwise relatively few
will experience for themselves the gains in living possible
from industrialization.

The political problem is to find means, even where
industrialization is proceeding apace, to bring some of
the gains of economic development to the masses of people
before they individually have been brought within the
orbit of the modern economy. The economic problem is how
to finance social services, which consume capital which
otherwise could be used for industrialization. The cost
may be justified as a political cost. It is desirable in
any case to select social services that may contribute
in some way to economic development rather than impede

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