neoclassical adjustment mechanism depends on the flexibility of factor prices. But if they are not flexible a lot of difficulties are established. For example, in the Keynesian liquidity trap, the interest rate may fail to go down beyond a minimum level hence preventing the capital-output ratio to be high enough to reach growth equilibrium. Third, there is no mention of an investment function in the model. It is assumed to be solely determined by savings. Hence entrepreneurial expectations about the future are not taken into account. Fourth, in the neoclassical models capital is assumed to be jelly-like, homogeneous, and malleable. This assumption is truly unrealistic, but without it present, it becomes very difficult to reach a stage of steady growth. Finally, technological progress is considered to be totally exogenous which is again extremely unrealistic and has been pointed out by many economists. To sum up, the neoclassical growth model of Meade is based on certain restrictive and unrealistic assumptions. Hence applying this model in the case of underdeveloped nations is almost impossible since the assumptions of perfect competition, full employment of labour and machinery, and constant returns to scale do not fit in their economic realities. Other contributions Professor Meade made other contributions to economics. For example, he showed that the labour-managed firm (or worker cooperatives) need not respond inefficiently to price rises even in theory. Along with fellow Neo-Keynesian economist James Tobin in 1980, Meade proposed nominal GDP targeting as a monetary policy rule during his Nobel Prize memorial lecture on 8 December 1977. Published works His books include: The Theory of International Economic PolicyThe Balance of Payments (1951) The Theory of International Economic PolicyTrade and Welfare (1955) Principles of Political Economy (1965–76) The Intelligent Radical's Guide To Economic Policy (1975) Liberty, Equality and Efficiency (1993) Notes References External links Short autobiography by James Meade Catalogue of the Meade papers at the Archives Division of the London School of Economics. Time.dufe.edu.cn including the Prize Lecture 8 December 1977 The Meaning of "Internal Balance" 1907 births 1995 deaths Nobel laureates in Economics British Nobel laureates Alumni of Trinity College, Cambridge Alumni of Oriel College, Oxford Academics of the London School of Economics People from Swanage People educated at Malvern College Companions of the Order of the Bath Fellows of the British Academy Foreign associates of the National Academy of Sciences English Nobel laureates Fellows of Hertford College, Oxford Fellows of