Rostow’s Stages of Economic Growth
This society remains traditional along with modern activities side by side. Roster has defined take-off as an interval in which old hurdles and resistances to steady growth are finally overcome. Growth becomes the normal condition of an economy. Conditions of take-off 1) The rate of net investment should be 5 to 10 percent of national income. The leading sectors of the economy should be developed. 3) Expansion of the modern sector. Roster has expressed that the take-off period should be relatively short. The short period can show the character of economic revolution. (Roster has given the following tentative take-off dates for some countries. Great Britain France 1914 united states 1843 – 1860 India 1952) 1783 – 1802 1830- 1860 Japan Canada 1878- 1900 1896 – Increase in NP to OHO Net investment rises to 012 (TOY). Roost’s Stages of Economic Growth By Chianti self-sustained. 4. The drive to maturity
This is also known as the stage of self-sustained growth. In this period modern technology is very well used to use all the resources. Nearly 10 to 20 percent of the national income is steadily invested in the economy. The structure of the economy changes; new industries are accelerated. There is increasing arbitration in the economy. The foreign trade of the country undergoes a radical change. This stage marks an increase in standard of living, and reduction in poverty rates. This is the final stage of growth. It is a stage of increased welfare.
The leading sectors shift towards the durable consumer goods and services. The consumers can afford to avail of luxurious commodities. The attention of the society is shifted from problems of production to problems of consumption and welfare. Criticisms of Rows stages of growth 1 . There are doubts regarding the division of economic growth into five stages. Many economists feel that these stages do not follow a set of sequence. 2. The various stages of growth are not very well defined. 3. The takeoff stage itself is subjected too number of criticisms. Roster has assumed a constant capital – output ratio. But the capital output ratio cannot be constant. 5. Roster is silent over the question of removal of unemployment. For reaching take-off stage, the unemployment has to be removed. 6. Economic development is not spontaneous. But the take-off suggests that economic development is spontaneous.