ROSTOW GROWTH THEORY

Walt Witman Rostow in his book titled The Stages of Economic Growth (1960) classifies the process of economic growth into the following five stages. 5. The Stage of High Mass Consumption.‡ Prof. The Traditional Society. The pre-conditions of Take-off 3. The Take-off 4. The Drive to Maturity. . 2. 1.

High birth and death rates.7.Predominance of agriculture.6. ‡ Main Characteristics. Economic activities only to meet domestic needs. 9. 4.8. religious places. ‡ 1. Science and technology unknown. expensive funerals. Political power with dominant social groups. 2. Limit of development.Ignorance about development avenues.5.‡ The Traditional Society. Law of diminishing returns. Expenditure state income spent for wars. . 10. 3. monuments. Significance of family and caste system.

Enlarged outlook traditional rigidities and bottlenecks break up. 4. 9. 6. Foreign trade.7. rate of saving and investment under 5%. The Preconditions of Take off. 8. Change in views rational and scientific attitude.Economic and social costs. 5. ‡ 1. ‡ Major characteristics. ‡ The second stage is a transitional stage responsible for creating preconditions for take-off stage. Importance of personal skills status depends on skill and abilities. .Less dependence on agriculture.Stress on development of transport. Decline in death rates.‡ 2. 2. 3.

‡ 2. Favourable govt.5.‡ 3.New possibilities for productive enterprises.9. Emergence of leading sectors three types of growth sectors primary.Foreign capital 4. supplementary and the derived growth sectors. Technical development 8.-a rise in investment from 5 to 10% of the GNP.Economic revolution self-sustaining and selfgenerating economic growth. 3. Entrepreneurship and capital formation sociopolitical revolution innovations capital accumulation new production techniques. Increase in demand 7. . Foreign trade 6. ‡ 1. ‡ Main features. policy. The Take-off ‡ This is a decisive stage in the evolution of any society and economic growth becomes a normal condition.

. technological maturity new production techniques. better status among developed nations. 3. 11. 6. 2. new political and social institutions. 9. shift of population from rural to urban areas. ‡ It is a period when the society has effectively applied the range of modern technology to the bulk of its resources. ‡ Major characteristics ‡ 1.4.less foreign dependence. 5. 8. change in the character of labour force and entrepreneurship.‡ 4. increase in exports. less dependence on agriculture. new leading sectors. greater economic and social security 7. investment rate rises from 10 to 20 %. high standard of living. The Drive to Maturity. 10. Rostow.

durable consumer goods and household instruments. It is final stage of economic growth. increasing financial security and full employment. 4. . 6. standard of living of the people rises extensive use of automobiles. society assumes the role of the welfare state. Consumption of comforts and luxuries rise. more resources for military and foreign policies for achieving international recognition and power. Main characteristics. 5. 2. The stage of Mass consumption.3. the rate of investment rise above 20% .‡ ‡ ‡ ‡ 5.

Explain the relevance of the theory in the Indian context. . ‡ 1.‡ Task to be done. ‡ 2. Explain the Rostow s theory of the various stages of economic growth.

Sign up to vote on this title
UsefulNot useful