Stages in Economic Development

The world is divided between rich industrialized countries and poor developing nations. Many times, people had been trying to explain the reasons for it. The first, who succeeded, was an American economic historian W. Rostow. He created the stages of growth model, known as the moderation theory, in the late 1950s. This model gives the opportunity to classify countries into groups according to certain parameters, analyze the path of their historical development, and explain the reasons and consequences of it.
The main point of Rostow’s theory is the position that all the rich industrialized countries have developed in the same way, passing through a number of stages. He believed that less-developed nations had to follow their way and pass through the same stages, and they would become similar in development to the industrialized countries. Rostow defined such stages of economic development: 1) traditional society (based mainly on farming economy); 2) preconditions to the take-off (development of extractive industries; mechanized and commercialized agriculture, a growth of infrastructure); 3) take-off (manufacturing industries; political and social adjustments to new life); 4) the drive to maturity (self-sustaining economic growth; increased number of industry, rapid urbanization); 5) the age of high mass consumption (rapid expansion of tertiary industries and welfare facilities; shift to the production of durable consumer goods).
However, in order to understand whether Rostow’s theory is right, it is necessary to analyze it on practice. The USA is the most economically and military powerful country, with unmatched global interests and global reach. A quarter of the world’s total gross domestic product is situated there. In addition, the country is a major source of entertainment as Hollywood, jazz, rap and rock are essential ingredients in global culture. In Rostow’s opinion, the USA is a rich industrialized country on the fifth stage of its development. It means that such features as high living standards, service industries dominate economy should characterize it. From the comparison of this information with data published in the article of BBC, it becomes clear that Rostow’s theory is right, and it accurately reflects the reality. The analysis of poor developing country can also prove it. For example, according to Rostow’s theory, Nepal is at the first stage of the development. Moreover, the economy overview of Nepal proves it. It states that Nepal is one of the poorest and least developed countries in the world. About one-quarter of its residents lives below the poverty line. Farming is the mainstay of the economy, providing living conditions for three-fourths of the population.
On the other hand, Rostow’s theory has many disadvantages. Firstly, it has been criticized for assuming that economies will naturally pass through each of the four stages consecutively. Secondly, Rostow’s model did not explicitly account for factors such as colonialism, physical geography, global politics, culture, war, and ethnic conflict, which may cause countries to follow quite different way. For example, Nepal’s economy may never look like American’s one because the two countries’ histories and cultures are completely different. Finally, Rostow’s theory does not account for deindustrialization. Therefore, it regards the development of countries only from one perspective.
To sum up, an American economic historian W. Rostow, with the help of the stages of growth model creation, explained the reasons why the world is divided into rich industrialized countries and poor developing ones. We have proved that this model reflects the reality and shows the paths of countries’ historical development. However, it has some disadvantages. They are assuming that economies pass through each of the four stages consecutively, ignoring some unique conditions of country’s development, and regarding their development only from one perspective.

The essay was written by the professional writer Lola Nickson, more her articles you can find simply following the link papers-land