Rostow's Stages of Growth - Overview

Overview

Below is a detailed outline of Rostow's 5 Stages:

• Traditional society
  • 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”
  • 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 & 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
  • 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
  • diversification of the industrial base; multiple industries expand & new ones take root quickly
  • manufacturing shifts from investment-driven (capital goods) towards consumer durables & domestic consumption
  • rapid development of transportation infrastructure
  • large-scale investment in social infrastructure (schools, universities, hospitals, etc.)
• Age of mass consumption
  • 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

Rostow claimed that these stages of growth were designed to tackle a number of issues, some of which he identified himself; and wrote, "Under what impulses did traditional, agricultural societies begin the process of their modernization? When and how did regular growth become a built-in feature of each society? What forces drove the process of sustained growth along and determined its contours? What common social and political features of the growth process may be discerned at each stage? What forces have determined relations between the more developed and less developed areas; and what relation if any did the relative sequence of growth bear to outbreak of war? And finally where is compound interest taking us? Is it taking us to communism; or to the affluent suburbs, nicely rounded out with social overhead capital; to destruction; to the moon; or where?"

Rostow asserts that countries go through each of these stages fairly linearly, and set out a number of conditions that were likely to occur in investment, consumption and social trends at each state. Not all of the conditions were certain to occur at each stage, however, and the stages and transition periods may occur at varying lengths from country to country, and even from region to region.