04-Modernization Theory and Dependency.pdf - Modernization...

• Conception of development as a uni-linear path from a traditional to
a modern society
• Rostow represented a wider intellectual climate of the 1950s and
1960s focusing on the need for massive investment, the mobilisation
of savings and seeing capital as the missing link in development.
Modernization Theory

• Five Stages:
• The Traditional Society
• Fatalistic patterns of thought
• Static production
• The Preconditions for Take-off
• Challenge to traditional society’s stability by external challenges
• Emergence of the idea of improvement of life by own effort
• Modern science into technology
• Increase in non-industrial sector (agriculture and mining etc)
• Surplus above subsistence  investment and labor freed for industrial prod.
• The Take-off
• Rapid change of economy in short period of time
• Requirement for very high levels of investment (especially in the leading industrial sector)
• High supply of entrepreneurship and loanable funds
• The Drive to Maturity
• New production techniques spread from the leading sectors to the rest of the economy
• The Age of High Mass-Consumption
• Looks surprisingly like Rostow’s North American society!
• whole population benefits from the increased opportunities for consumption
Rostow’s Stages of Economic Growth (1960)

Traditional Society
• Subsistence farming
• Fatalistic
• Non-Centralized Power
(small governing elite)
Preconditions for Take-
Off
• Start of
commercialization
• New ideas
• Increase in
investment
• Traditional social
structures remain
Take Off
• Modern
technologies
• Stable flow of
capital
investment
• Industrialization
• Growth of
manufacturing
Drive to
Maturity
• Diversification
• specialization
• innovation
• investment
Age of Mass
Consumption
• Highly
sophisticated
society
Time
Level of Economic
Development

Stage Time Period Characteristics
Traditional Pre-nineteenth
century
Native American subsistence and hunter–gatherer societies; European settlers focus
on trade of agricultural goods
Preconditions
for Take-Off
1815–40s Focus on economic activities after independence gained in 1776; higher productivity in
agriculture, e.g. cotton production; large-scale infrastructure projects with