The dual-sector model

In this chapter, we discuss the Dual-Sector Model, our primary aim being the determination of the impact of AI on the model. In reviewing the literature on the dual-sector model, what is clear is that labour is the crucial factor of production in both the agricultural sector and the industrial sector. It is common cause that in the era that is characterized by technological advances, particularly AI in workplaces, we are beginning to observe considerable parts of the production line taking the automated forms. We think that in areas where it has not, and those areas involve repetitive tasks, the expectation is that this would happen. This affects the critical aspect of the dual-sector model, which is labour. From the perspective of automated agents, the idea that labour can easily migrate from a sector that is characterized by poor education to the industrial sector will falter. Firstly, if we were to suppose the industrial sector as supposed by Lewis that it will be highly capitalized and that profits are reinvested in order to generate efficiencies, it is given that this is a sector that will take advantage of machines efficiencies, and automate. As such, with AI-powered agents such as robots, there may not be employment opportunities in the destiny sector of the economy as Arthur Lewis espoused. Expectations are than factories and the industrial sector will be lean, specialized and consisting of highly skilled human resources that will be working together with machines. Therefore, with leaner factories and the demand for highly skilled resources, there will be no migration. AI-powered machines are already deployed in the agricultural sector in order to improve yields. The agricultural sector itself, in the era dominated by AI, is not a feeder to the industrial sector but a fully fledged sector that will also be leaner with machines having a more significant role to play. So, labour could also be expected to experience a squeeze on this front as the sector moves to become highly capitalized and profits reinvested in order to generate efficiencies.