Modernization theory is a theory used to explain the process of modernization within

societies. The theory looks at the internal factors of a country while assuming that, with
assistance, "traditional" countries can be brought to development in the same manner more
developed countries have. Modernization theory attempts to identify the social variables which
contribute to social progress and development of societies, and seeks to explain the process of
social evolution. Modernization theory is subject to criticism originating among socialist and
free-market ideologies, world-systems theorists, globalization theory and dependency theory
among others. Modernization theory not only stresses the process of change but also the
responses to that change. It also looks at internal dynamics while referring to social and cultural
structures and the adaptation of new technologies. The following are the modernization theories
for development.

Rostow's theory of economic growth is one of the more structuralism models of

economic growth, whereby his main thesis is that it is logical and practically possible to identify
stages of development to classify society according to those stages. Whereby he distinguished
the stages by considering productive capacity and technology, manufacturing industry, transport
and saving investing and trade, these stage are as follows;-

Traditional society, this stage is characterized by subsistence agriculture or hunting &

gathering; almost wholly a "primary" sector economy, limited technology, a static or 'rigid'
society, lack of class or individual economic mobility, with stability prioritized and change seen
negatively.

Pre-conditions to "take-off", which is characterized by external demand for raw materials

initiates economic change, development of more productive, commercial agriculture & cash
crops not consumed by producers and/or largely exported, widespread and enhanced investment
in changes to the physical environment to expand production (i.e. irrigation, canals, ports)
increasing spread of technology and advances in existing technologies, changing social structure,
with previous social equilibrium now in flux, individual social mobility begins, development of
national identity and shared economic interests

Take off, under this stage of economic growth is being endowed by manufacturing begins
to rationalize and scale increases in a few leading industries, as goods are made both for export
and domestic consumption, the "secondary" (goods-producing) sector expands and ratio of
secondary vs. primary sectors in the economy shifts quickly towards secondary, textiles &
apparel are usually the first "take-off" industry, as happened in Great Britain's classic "Industrial
Revolution"

Drive to maturity, Rostow tried to explain how the development of economic

encompasses a diversification of the industrial base; multiple industries expand & new ones take
root quickly, manufacturing shifts from investment-driven (capital goods) towards consumer

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durables & domestic consumption, rapid development of transportation infrastructure, large-
scale investment in social infrastructure (schools, universities, hospitals, etc.)

Age of high mass consumption, it is being attributed by the industrial base dominates the
economy; the primary sector is of greatly diminished weight in economy & society, widespread
and normative consumption of high-value consumer goods (e.g. automobiles), consumers
typically (if not universally), have disposable income, beyond all basic needs, for additional
goods.

Nurkse vicious circle of poverty states that a society is poor because it is poor. A
society with low income has both low level of serving and low level of consumption. Nurkse
was in favor of attaining balanced growth in both the industrial and agricultural sectors of the
economy. He recognized that the expansion and inter-sectoral balance between agriculture and
manufacturing is necessary so that each of these sectors provides a market for the products of the
other and in turn, supplies the necessary raw materials for the development and growth of the
other. Nurkse's theory discusses how the poor size of the market in underdeveloped countries
perpetuates its underdeveloped state. Nurkse has also clarified the various determinants of the
market size and puts primary focus on productivity. According to him, if the productivity levels
rise in a less developed country, its market size will expand and thus it can eventually become a
developed economy. Apart from this, Nurkse has been nicknamed an export pessimist, as he
feels that the finances to make investments in underdeveloped countries must arise from their
own domestic territory.

Schumpeter theory of motive force, process and goals, under this theory Schumpeter
explained model of development that, the generating force is provided by the
entrepreneurships, the process is innovation and the goal is the establishment of a position
of a wealth and power of entrepreneur. The entrepreneurs disturb this equilibrium and are the
prime cause of economic development, which proceeds in cyclic fashion along several time
scales. In fashioning this theory connecting innovations, cycles, and development. Schumpeter
also thought that the institution enabling the entrepreneur to purchase the resources needed to
realize his or her vision was a well-developed capitalist financial system, including a whole
range of institutions for granting credit. One could divide economists among, those who
emphasized "real" analysis and regarded money as merely a "veil" and those who thought
monetary institutions are important and money could be a separate driving force. Both
Schumpeter and Keynes were among the latter.

The Concept of Countervailing Power by Galbraith explains that the American

economy was managed by a triumvirate of big business, big labor, and an activist government.
Galbraith defines the actions of the industry lobby groups and unions as countervailing power.
He contrasted this arrangement with the previous pre-depression era where big business had
relatively free rein over the economy. According to concept of countervailing power Prof J.K

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maintains that the growth of monopoly in the advanced countries, particularly in the USA has
been accompanied b y a growth of countervailing power on the opposite side of the market like
trade unions, retail chain store, and cooperatives societies’ trade union. The growth of monopoly
increases the gains from building up the countervailing power and induces the growth of the
economy in the world of monopoly.

The gape approach theory by Leibeinstein in 1960, argues that there are some limiting
factors which can cause that gape approach as follows:- low productivity, poor soil and tropical
climate, technological backwardness, un favorable demographic features in the form of large and
low population, low education and cultural level, predominant subsistence agricultural economy
with poor credit and marketing facilities.

THE APPLICABILITY OR RELEVANCE OF VICIOUS CIRCLE OF POVERTY

TO TANZANIA CONTEXT.

NEARLY 50 years after Independence, Tanzania remains one of the poorest countries in
Africa with 33 percent of the population living below the poverty line of one US dollar per day.
The population of people with hunger and low nutrition is increasing. This so despite all
strategies adopted after independence to do away with three enemies of the nation which are
ignorance, poverty and disease. Tanzania is still in the vicious cycle of poverty characterized
with low incomes, low saving and low investment. It is against this background that Tanzania
has to improve its investment climate to attract foreign direct investment to fill the gap.

It is said that fighting corruption and more investment in physical infrastructure will
attract more investors leading to the projected growth rates of 8-10 per cent as stipulated by the
World Bank which are growth rates needed for poverty reduction. There is a need for a broad-
based economic growth and more equitable distribution of income to realize poverty reduction
targets. In the 1990s the FDI flows amounted to US$10m per annum; but this figure is now in the
region of $600m per annum (2008). Unfortunately most of the FDI flows went to mining and
tourism which do not have many backward and forward linkages with the rest of the economy
and there was little impact on economic growth rate, job creation and poverty reduction.

When Tanzania got independence in 1961 it coincided with the formation of Aid
agencies like SIDA, DANIDA, CIDA, USAID and many others to disburse official development
assistance to developing countries like Tanzania and Africa in general. According to Prof. W.
Rostow of Harvard at that time it was theorized that only that was needed for Africa to make an
economic take off was more increase in development aid. This was not realized because the
absorption capacity of AID and ability to implement funded projects was not in consideration.
Even the technical assistance there was no aid effectiveness because the expatriate personnel
were not conversant with local conditions including the local attitudes towards the need for
socio-economic development.

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 The Tanzania Government formulated three year development plan (1961-1964) and five
year development plans 1964-1969 and 1969-1974. The goals of these plans were not realized
because donors did not meet the target of aid disbursement of 0.7 of Gross National Income and
this proved that dependence on external sources to finance development projects was not an
effective tool of spearheading socio-economic development. In 1964, an Investment Promotion
and Protection Act were passed but the expected FDI flows did not come and there has not been
local private sector to spearhead industrialization because of low national savings.

It was against this background that the Arusha Declaration was promulgated and the state
(public sector) became the only reliable source of investment using tax revenue to start new
projects and to bail out by subsidy state owned enterprises which were collapsing due to many
debts and insolvency as a result of poor management and plundering of public funds.

It is estimated that between 1970 and 1979 the Government invested nearly 20 per cent of gross
domestic products (GDP) in the industrial sector at the expense of agriculture which was left to
peasants in the Ujamaa villages. All large side commercial farms in sisal, coffee and wheat
cultivation had been privatized by 1972 and were left to NAFCO which had little expertise in
managing large scale commercial farms and there was a general decline in production of cash
and food crops. The positive side of investment in the industrial sector was that at least when the
economy was opened up to foreign investors there were industries to privatize including TBL,
TCC, TOL, three cement companies and many other companies in the textile and leather sector.

Free market economy was adopted in 1986 starting with trade liberalization removing
barriers to imports of goods in order to end shortages but this also led to de-industrialization and
loss of jobs because the inefficient local firms could not compete with imported goods from Asia
(often subsidized) and Europe where there were economies of scale and hence lower production
costs.

Attempts to reduce poverty levels have included the Poverty reduction strategy (2000-
2005), MKUKUTA I (2005-2010). Tanzania has also a National Development Vision 2025
which aims at making Tanzania a semi-industrialized economy with a modernized agricultural
sector. Hence MKUKUTA goals and MDGs were linked to Vision 2025. MKUKUTA has three
cluster which include reduction of income poverty and hunger by 50 percent by 2015 and
investment in social services to improve the quality of life and social well being of the people.

The other cluster is good government and accountability in managing the development
process. MKUKUTA review shows that poverty levels declined from 35.5 per cent (2005) to 33
per cent in 2008 but the number of people living in poverty increased in terms of numbers and
we are still far from halving the number of people living with hunger.

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 For there to be a meaningful growth there is a need to attract investment in sectors
considered to be growth drivers and these are labour intensive industries, agriculture, small scale
mining and small and medium enterprises which will create jobs and contribute to poverty
reduction.

As far as Millennium Development Goals are concerned progress has been made in
school enrollment and gender equally and women economic empowerment. Little progress has
been made in reduction of death of under-five and infant mortality. Maternal death is reported to
be on the rise due to poor health services delivery.

Achieving environment sustainability seems to be a goal that will be hard to realize in the
short term.

There is still a long way to go to combat HIV/Aids, TB, Malaria and other communicable
diseases.

It is said that to attract investors in order to stimulate economic growth and reduce
poverty we need macro-economic stability with low inflation rates and predictable exchange
rates. But people do not eat macro-economic stability and hence there is a need to have growth at
a macro-level to trickle down to the lowest levels because economic growth rates should be
translated into better standards of living of the people and social economic development at the
lowest levels of society.

Generally, modernization theories of social development try to examine the society in

terms of social, political and economical in which all society had to pass into a certain stages in
order to attain development. Modernization theorists often saw traditions as obstacles to
economic growth. Modernization might deliver violent, radical change for traditional societies it
was thought worth the price. Critics insist that traditional societies were often destroyed without
ever gaining promised advantages, if among other things, the economic gap between advanced
societies and such societies of traditional actually increased. The net effect of modernization for
some societies was therefore the replacement of traditional poverty by a more modern form of
misery according to these critic, others point to improvements in living standards of people
includes physical infrastructure, education and economic opportunity to refute such criticisms.

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 REFERENCIES
Distributed by Yale UP, 1996.Lichter, D.T. (1997) Poverty and Inequality Among Children. Annual Review

of Sociology.

Gilman, Nils. (2004) Mandarins of the Future: Modernization Theory in Cold War America.

Johns Hopkins University Press.Jaquette, Jane S. (1982). "Women and Modernization Theory,"

P. Baran, E. J. Hobsbawm. "The stages of economic growth" Kyklos 14(2) p. 234-242 (1961)

Payne, Ruby K. Framework for understanding poverty. Highlands, Tex: Aha! Process, 2005.Harris, Irving

W. W. Rostow. The Stages of Economic Growth: A Non-Communist Manifesto Cambridge University

Press (1960)