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Rostow and the Five Stages of Economic Development

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Introduction

 To Walt Whitman Rostow, a well renowned economist, there are five stages of development that any society has to pass through to attain its highest level of economic growth and development. These stages included the traditional or subsistence stage, the precondition to take off stage, the take off stage, drive to maturity and the age of mass consumption stage. To him, any nation lay in any of the stages mentioned above at any given time.[1] This implies that some countries lag behind in the traditional or subsistence stage while others have risen to the heights of their economic development and are in the high consumption stage.

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His theory is often viewed as one of the historical linear theories of economic development. Rostow argued that his theories were not just a description of the happenings of the times but rather found a strong backing from the production theories.

The traditional or subsistence stage

  The traditional or subsistence stage is one where the society is characterized by agrarian traditions.

Rostow notes that it is “one whose structure is developed within limited production functions that are based on pre-Newtonian science and technology as well as pre-Newtonian attitudes towards the physical world”[2]. To Rostow, this agrarian based society faces many challenges as using the rudimental tools the production level is minimal. It is organized in clans and has a mentality that Rostow defined as ‘fatalistic’.

             The population growth in this stage is also minimal and people seek spiritual explanations to situations in the physical world. Social mobility is quite minimal as only the powerful own the factors of production and hence enjoyed the benefits reaped.[3] The agrarian society is predominantly based on unskilled labor which triggers low productivity. Many less developed countries can be said to be in this stage.[4]

The take off

             In the second stage, the society exhibited signs that it was ready to ‘take off’ into another level where it would attain self sustained growth. An example of such a stage is the Western Europe in the late 17th and early 18th centuries.[5] In this stage, modern science was slowly being embraced and trade started to thrive. The traditional society was slowly being reformed as with modern techniques production or output increased.

             In this stage, less developed countries interacted with the developed ones a process that paved way for the adoption of better techniques of production which boosted economic growth. The population also rose and infrastructures became more developed.[6]

             In the take off stage economic growth normalized. To Rostow, this was the stage where “old blocks and resistances to steady growth were finally overcome”.[7]  The factors that favored economic growth became more profound making economic progress a reality. The rise of an entrepreneurial class who “seize the opportunities provided by their resources in the expanding economy” was also evident. 176

 Capital investment also rises twofold from a mere 5% of the national income to about 10% and there was the establishment of various industries in diverse sectors. Transformation was also recorded in the political as well as the social structure to sustainable levels.

The drive to maturity

             The fourth stage or the drive to maturity was characterized by increased economic growth that saw as much as 20% of the national income channeled into new production opportunities. With this investment, there was the development of industries to great levels and they could now “mature and level off”.[8] Other new industries also came up boosting economic growth and development. The social as well as the institutional arrangements also recorded growth and transformation precipitating the emergence of a “mature economy”. [9]The society now embraced the home generated newly acquired technologies to ensure economic growth and development. The levels of employment rose sharply in this stage and the population growth became stable.

High mass consumption

             In the final stage or high mass consumption, there was a diversion from the intense investment in heavy industries to the production of consumer durables as well as services in the market. There was also the increased investment towards the provision of social welfare and the society had successfully shifted from being traditional to being modern.  At this stage, the population growth slowed down and the urban life was more profound as more people worked in offices as opposed to factories. With the immense production people could consume more than they actually needed. [10]

Criticism

 Rostow’s theory was characterized by much criticism from those who perceived it as only being historical. He is condemned for assuming that all countries had equal resources, climatic conditions as well as the same population. Rostow also failed to put into consideration the varying cultures across nations that would ensure varying interpretations to economic development.[11] This was however untrue as some countries like in the Middle East minimal arable lands that would make agriculture ineffective. On the contrary they could be endowed with natural resources like natural gas and oil which would see them attain economic growth and development without necessarily going through the said stages. His argument that development was uniform is also criticized in the sense that it would be impossible to have uniform development when nations had varying natural resources. [12] Rostow is also condemned for not putting into consideration that some countries may have registered economic development at the expense of the other. His theories are also not clearly defined making it difficult to establish where a nation actually lies in his linear economic growth theory. His theory is also deemed inadequate as it fails to put into account the role of an effective and stable financial system that would be vital in the economic development of any nation. He fails to address what would happen if the investments made were not productive or fruitful and makes the assumption that all investments would trigger economic growth.

Conclusion

Rostow’s development theory of economic development is one that can be very applicable in some instances but is totally inapplicable in others. Most countries have rose to great economic development levels overtime as invention of modern techniques, population changes and changing patterns of investment have been adopted. These changes will however differ with varying nations and consequently economic development will not be uniform. The role of savings, investment, attitudes that embrace scientific reasoning cannot be underscored in triggering economic development as posited by Rostow in his stages of economic development.

Bibliography:

Nash J. Indigenous Development Alternatives Urban Anthropology and Studies of

            Cultural Systems and World Economic Development, Vol. 32, 2003. 57-98

Nagle. G. Development and Underdevelopment. Nelson Thornes Publishers, 1998.

p 13-15

Peet, R and Hartwick, E. Theories of Development, Second Edition: Contentions,

            Arguments, Alternatives. Guilford Press, 2009. p 126-250

Rones, P  An Analysis of Regional Employment Growth, 1973-85. Monthly Labour

            Review, Vol. 109, 1986. 3-13

Preston Peter. Development theory: an introduction. Wiley-Blackwell, 1996

Ezeala-Harrison Fidelis. Economic development: theory and policy applications.

Greenwood Publishing Group, 1996

[1] Preston Peter. Development theory: an introduction. Wiley-Blackwell, 1996 175

[2] ibid

[3] Peet, R and Hartwick, E. Theories of Development, Second Edition: Contentions,

                Arguments, Alternatives. Guilford Press, 2009. p 126-250
[4] Ezeala-Harrison Fidelis. Economic development: theory and policy applications

Greenwood Publishing Group, 1996
[5] Rones, P  An Analysis of Regional Employment Growth, 1973-85. Monthly Labour

                Review, Vol. 109, 1986. 3-13
[6] ibid
[7] ibid
[8] Ezeala-Harrison Fidelis. Economic development: theory and policy applications

Greenwood Publishing Group, 1996
[9] ibid
[10] Nagle. G. Development and Underdevelopment. Nelson Thornes Publishers, 1998. p 13-15

[11] Ezeala-Harrison Fidelis. Economic development: theory and policy applications

Greenwood Publishing Group, 1996
[12] Nash J. Indigenous Development Alternatives Urban Anthropology and Studies of

                Cultural Systems and World Economic Development, Vol. 32, 2003. 57-98

 

Cite this Rostow and the Five Stages of Economic Development

Rostow and the Five Stages of Economic Development. (2016, Dec 05). Retrieved from https://graduateway.com/rostow-and-the-five-stages-of-economic-development/

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