Abstract

The aim of this paper is to consider the role of institutions in the process of structural change with regard to composition and level of employment. Contrary to the standard neoclassical growth theory, since both technical progress and the growth in demand are not uniform in all sectors, the combination of disproportional changes in technology and disproportional changes in demand results in disproportional growth and deep changes in the structure of the economy, as well as in the level and composition of employment. The paper points out some “institutionalµ factors that deeply influence, on the one side, the intensity and the direction of technical progress in each sector and, on the other side, the composition of final demand, which are the roots of structural change. Finally, some indications are drawn about the possibility open (or, to say it better, “leftµ under the constraints of globalised markets) for every single country to govern the process of structural change through acting on these institutional factors.