Economic development relies, on the supply side, on existing natural resources, on the available stock of physical capital, and on the human ability to produce. On the demand side, it relies on capital accumulation, on consumption, and on exports. Supply and demand should grow in a balanced way, but a universal characteristic of capitalist economies is that supply usually exceeds demand so that there is widespread unemployment of human resources. Keynes criticized Say's law, which presupposes an automatic equilibrium between supply and demand, by reference to the possibility of hoarding and the liquidity preference. In this chapter, even if we know that there are other factors determining the underutilization of resources in developing countries, I argue that the central problem is the insufficiency of opportunities for export-oriented investment opportunities, which, in turn, is mainly due to the existence of a tendency toward exchange rate overvaluation in those countries, which discourages investment in the production of tradable goods. This overvaluation stimulates imports and discourages exports, thus limiting new investments that are essential for sustained domestic aggregate demand. Theorists of economic development usually emphasize limitations on the supply side such as a lack of education, health care, and technical competence as well as a lack of available capital to hire individuals. However, when human resources are idle, it is evident that we need to search for the causes of the bottlenecks of economic growth mainly on the demand side.