One of the most notorious thinkers in the twentieth century in regards to Economic Growth and Development was W.W. Rostow. He was an American economist and public figure in the government. Before Rostow’s theory, people attitudes toward economic development were based on the theory that modernization was portrayed by the Western world. The Western World had the wealthier and more powerful countries in that day and age. These countries and nations were able 1to advance from the initial stages of underdevelopment. Therefore, other countries should model themselves after the West World and seek to have a liberal democracy and a more modern state of capitalism.
With that thought, Rostow wrote his classic “Stages of Economic Growth” in 1960. He explained five steps which all countries must pass to become developed. These steps include: 1) a traditional society, 2) preconditions to take-off, 3) take-off, 4) drive to maturity, and 5) age of high mass consumption. Rostow’s model stated that all countries exist somewhere on this linear scale, and climb upward through each stage in the development process:
1. The Traditional Society:
In the Traditional Society Rostow explains that the economic system is stationary and dominated by agriculture with traditional cultivating forms. In this stage productivity by man-hour labor is lower, compared to the growth stages that follow. The traditional society describes a hierarchical structure where there is very little to no movement vertically nor social mobility. A historical example of Rostow’s “Traditional Society” can be found during the time of Newton. This stage is described as an agricultural based economy, with intensive labor and low levels of trading. The people in this society do not ha...
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...ption, not even thinking that different nations have different priorities. For example, while Singapore is one of the most economically prosperous countries, it also has one of the highest income disparities in the world.
Finally, Rostow disregards one of the most important geographical principals: where a country is located. Rostow assumes that all countries have an equal chance to develop, without regard to population size, natural resources, or location. Singapore, for instance, has one of the world's busiest trading ports, but this would not be possible without it being an island between Indonesia and Malaysia.
Besides the many criticisms of Rostow's model, it is still one of the most widely used development theories. It is a great explanation of how geography, economics and politics are all intertwined.
8) Theories of Development : Classical vs. Neoclassical
...conomically beneficial trade and technology development. In this regard the Epilogue uses sound logic to plausibly answer the wealth question. On the other hand, Mr. Diamond uses the same "national competition" thesis to purport that Asia's large, centralized governments were conspicuously growth-inhibitive. This argument would not seem to pass muster given what we have learned about the role of governments. Professor Wright's slides state that "Centralization may limit predation and even allow for growth" as "centralized predation = incentives to maximize the haul " This clearly refutes Mr. Diamond's argument that centralized, monopolistic Asian governments impaired societal advances. Thus, Guns, Germs, and Steel can scantly explain why China and the Middle East remain emerging markets while Western and Northern Europe enjoy significantly larger national wealth.
At one point in time poverty was the general fact of the world. Man was always expected to live on the line of poverty, majority of the economic thinkers couldn’t see the world moving away from this standard but we did and have gained great affluence. As society has grown from this poverty stricken state it once was in, into an affluent one, the ideas used to run it have yet to change in some ways. In The Affluent Society, John Kenneth Galbraith explains how with great economic growth there should be growth in economic ideas as well.
Though it is very convincing, I do not fully agree with this concept. I agree that being located in a good geographical location enables a civilization to gain the upper hand early on, but I disagree that without good geography, a civilization will not be able to reach prosperity. My argument parallels James A. Robinson and Daron Acemoğlu’s argument made in Why Nations Fail: The Origins of Power, Prosperity, and Poverty. They used the example of Nogales, a city that is divided into two, with the northern half in the United States that enjoys a flourishing and safe life, while the southern half in Mexico and struggles to maintain a good living standard. This city has the exact same geographical conditions, and yet, the welfare varies drastically. The authors explain since the northern part of the city is in the United States, it has the access to the economic institutions, technology, and the government of the United States. In contrast, the southern part of the city suffers due to the corruption, disorder, and poor government system that is of Mexico. The point Robinson and Acemoğlu try to make with the example of Nogales, which I am in concurrence with, is that since it was technological development that gave North America the step up in the modern era, it doesn’t fully explain why Latin America, who
All of our history can be dated down to some place anywhere in the world and the time, now just imagine if that history could still be affecting you to this day. In Jared Diamonds Guns, Gems, and Steel he explores the idea, the theory that geographic could determine the differences between societies and social development. The book is framed upon a question that Yali, a New Guinean politician, asked him as they were chatting the question being “Why is it that you white people developed so much cargo and brought it to New Guinea, but we black people had little cargo of our own?” Diamond concludes that geography has ultimately affected the differences between peoples of the world.
Blij, H.J. de , Peter O. Muller, Jan Nijman, and Antoinette M.G.A WinklerPrins. The World Today Concepts and Regions in Geography. Fifth Edition ed. United States of America: John Wiley & Sons, Inc., 2011. Print.
...lated with the food production to make other produce, like pottery, leather goods and cloth. (Bairoch, p14) Economic specialization due to emergence of advanced technologies led to the creation of influential classes of leaders and social stratification. Regional fiscal specialization frequently centered on possessions indigenous to the area in which the group of people was situated. Trade was enhanced among areas having different goods and services so as to provide an equitable and reasonable distribution of products. Social stratification was limited in ancient agricultural communities. Property may have been owned communally by all members of the society which provided cheap labor. The role of women in agricultural sectors had declined and men took over the necessary responsibilities of agriculture and started to control the application of the new tools.
Silva, Julie A. and Robin M. Leichenko. Economic Geography. Vol. 80, No. 3 (Jul., 2004), pp. 261-
India and China however, were landlocked and were by far the greatest industrial powers in the world till the Industrial revolution. Technology, not geography, helped temperate agriculture and industry to zoom ahead. One way a country overcomes geographical isolation is to improve its transportation infrastructure. Better roads, ports, paths, and other modes of transport provide access to world markets. But a country can only derive full benefits from these investments against a backdrop of good trade and macroeconomic policies. Consequently this leads to the belief that people again control the thought of their own geography.
...an overabundance of information all applicable to the topic. My feeling was that such an overwhelming load of facts and systems directed me away from the most important facts of the chapter. Its imperative that the student understands the small scale relationship to economic development. Therefore my attempt was to highlight the main topics of the chapter and relate them to the reader to provoke intrest and thought towards many of these important life changing situations that occur everyday. If one can see past all the theories primarily and see the cause and effects behind them, they’re appreciation for the ideas stated in the theories.
Thus, Rostow's development ladder is highly challenged as it gathers a lot of critiques. Rostow's five stages of economic growth begin with the traditional society. As described by Rostow, the underdevelopment is naturalised in this structure with the evidence of constrained production means such as technology. In this part, the society applies subsistence economy that technically results in small margins of productivity such as hunter-gatherer society (Sahlins 1972:1). Undesired to do nature exploitation, Rostow viewed society at this stage as restrained from progress.
As Escobar points out in The Problematization of Poverty, one of the many changes in the post-WW2 era was the "discovery" of mass poverty throughout the world. This "discovery" had massive implications for development discourse. Prior to WW2, development discourse was limited to the colonial experience. But with the end of colonial rule lurking on the horizon, western academics began to formulate theories of economic growth and "modernization." As a result, an entire genre of academic research emerged: the development discourse. The aim of development discourse was to chart out patterns of growth (which were based on the historical successes of the West) that newly independent countries could use, primarily to escape vicious cycles of poverty, famine, etc.
In order for any country to survive in comparison to another developed country they must be able to grow and sustain a healthy and flourishing economy. This paper is designed to give a detailed insight of economic growth and the sectors that influence economic growth. Economic growth in a country is essential to the reduction of poverty, without such reduction; poverty would continue to increase therefore economic growth is inevitable. Through economic growth, it is also an aid in the reduction of the unemployment rate and it also helps to reduce the budget deficit of the government. Economic growth can also encourage better living standards for all it is citizens because with economic growth there are improvements in the public sectors, educational and healthcare facilities. Through economic growth social spending can also be increased without an increase of taxes.
Economic development is a term that economists, politicians, and others have used frequently since the 20th Century. The concept, however, has been in existence in the West for centuries. The term refers to economic growth accompanied by changes in output distribution and economic structure. It is concerned with quality improvements, the introduction of new goods and services, risk mitigation and the dynamics of innovation and entrepreneurship.
in relation to development. Development is explained by the Oxford Dictionary as the process of developing or developed in a specified state of growth or advancement. Underdeveloped as according to the Oxford Dictionary is ‘not fully developed or not advanced economically’ which is meant for a country or a region. We can certainly see the difference between underdeveloped and developed where the changing situation emerges from the economic point of view. To be more specific, worlds within world were created i.e. the nomenclature of First World and Third World came into picture. The First World is said to be the industrialised, capitalist countries of Western Europe, North America, Japan, Australia, and New Zealand who are developed (as explained in the definition). The Third World includes the developing countries of- Asia, Africa and Latin America who are still in the mode of developing. Normally we understand the situation of underdevelopment is because the third world was under the colonies or the colonial rule for a certain period of time and lags behind the first world in every aspects like- social, economical, political, technological advancements which are yet to be seen in the third world fully like the first world. In this paper we will talk about various theorists from - Karl Marx (capitalism and class conflict), Kay and Amin (merchant capitalism, colonialism and neo-colonialism), Vladimir Lenin (imperialism), Andre Gunder Frank (third world dependency), Lipton (urban bias) and dependency theory. Here in this paper we will try to explain and understand the relevance of the various underdevelopment theories and different attributes related to it terms of the Indian Context.
Different states go through different types of political and economical systems through a life time. In this case, most of the agricultural society was largely supported by the feudal system social hierarchy. Karl Marx defined feudalism as the power of the ruling class based on the control of “arable land”, this in turn affected class society based on the exploitation of the peasants who farm these lands (Beitscher and Hunt, 2014). In the feudal system, most of the rights and privileges were given to the upper classes. In this hierarchical structure, the kings occupied the highest position, followed by barons, bishops, knights and peasants (History-world.org, 2014).Feudalism is considered to be the “medieval” form of government (Beitscher and Hunt, 2014). Before capitalism came around as an economic model most states were a feudalistic country. These systems had an affect on society due to the fact it impacts citizens by “controlling” how they live and interact. The peasants were required to work for the nobles in return for land. This hierarchy was fuelled by the religious assumptions of the time that stated kings, dukes and other nobles served by the will of God over everyone else lower down the social order (Beitscher and Hunt, 2014). As industrialism provided a much more technical understanding of the world, it challenged these religious assumptions for the social