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Objective and Essential Learning

7.5 Explain different theories of economic and social development.

7.5.1 Different theories such as Rostow’s Stages of Economic Growth, Wallerstein’s World System Theory, dependency theory, and commodity dependence, help explain spatial variations in development.

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How can we explain spatial variations in development?

Rostow’s Stages of Economic Growth (aka Modernization Model)
Wallerstein’s World Systems Theory (aka Core-Periphery Model)

Dependency Theory

Brandt Line (aka North-South Divide)

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Rostow’s Stages of Economic Growth

Modernization Model

Time

Level of Development

How do countries become economically developed?

Is there a “formula” for economic growth that could be applied to LDCs?

Modeled off of the development of the US & Western Europe - particularly Great Britain.

Take Off

High Mass Consumption

Pre-Conditions to Take Off

Drive to Maturity

Traditional Society

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Rostow’s Stages of Economic Growth

Modernization Model

Time

Level of Development

Traditional Society

Political Power	Local or regional, based on ownership of land
Trade	Local
Setting	Rural
Culture	Family-based
Labor Market	Subsistence farming, primary sector, informal
Technology	Low, little science
Wealth	Limited, little ability to “move up.”
Examples	Medieval Europe, no country is currently here

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Rostow’s Stages of Economic Growth

Modernization Model

Time

Level of Development

Pre-Conditions to Take Off

Political Power	Leadership begin to invest in the country
Trade	Small-scale international trade begins to develop
Setting	Beginning of urbanization
Labor Market	Shift to secondary, beginning of industrialization
Technology	Transportation systems develop, mechanized farming
Wealth	Increased investment in business & infrastructure
Examples	Nigeria & Afghanistan (remember...danger of a single story)

Traditional Society

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Rostow’s Stages of Economic Growth

Modernization Model

Time

Level of Development

Pre-Conditions to Take Off

Trade	Major export industry, increased international trade
Setting	Urbanization
Labor Market	Full industrialization and high output capabilities
Technology	Advancements in technology
Wealth	Businesses are making money -> shift to patterns of consumption.
Examples	NICS (Newly Industrialized Countries) Philippines, India, Vietnam

Traditional Society

Take Off

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Rostow’s Stages of Economic Growth

Modernization Model

Time

Level of Development

Pre-Conditions to Take Off

Population	Growth declines
Labor Market	Specialization of industry, workers become skilled & widespread education.
Technology	High levels of power consumption, improved transportation & communication systems
Wealth	Investment in social infrastructure such as schools, hospitals, etc.
Examples	Brazil, Russia, China

Traditional Society

Take Off

Drive to Maturity

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Rostow’s Stages of Economic Growth

Modernization Model

Time

Level of Development

Pre-Conditions to Take Off

Traditional Society

Take Off

Drive to Maturity

Population	Continues to decline or goes into the negative.
Labor Market	Mostly tertiary sector; highly skilled & highly educated workforce.
Technology	High levels of power consumption, improved transportation & communication systems.
Wealth	People spend $$ on nonessential goods
Examples	Japan, South Korea, Eastern Europe, The US, Canada

High Mass Consumption

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Criticisms of Rostow’s Model

Based on industrialized, capitalist, democratic countries.

This falsely assumes that all countries value those ideals. Other cultures value kinship and community as more important than wealth or status. �

SCALE & Uneven Development

Stages of growth are not uniform across one country. For example, as a whole, India fits in Stage 3 or 4, however undeveloped parts of the country would be stage 2.

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Criticisms of Rostow’s Model

3. Linear Progress

Not all countries will progress through the model in the defined order. Wars, corruption, and natural disasters are examples that could impact the stage of a country. �

4. Globalization

Rostow’s model focuses on the development of a single country and does not take into account that fact that all countries are connected in our globalized world. For example, transnational corporations could economically impact countries differently. �

5. Equal Potential to Develop

Does not take into account that there are major differences between countries such�as climate, landforms, access to natural resources, relative location...that could help or hinder the development.

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Criticisms of Rostow’s Model

6. Sustainability

The highest level of “modernization” is massive consumption. This did not take into account the natural environment, depletion of resources, and level of waste that is generated by massive consumption. �

7. Legacy of Colonialism

Rostow did not factor in the massive impact of centuries of colonialism on less developed countries. Most countries that reached the high level of mass consumption did it because they exploited the resources of LDCs. Countries that are trying to develop today do not have the option to colonize in order to get ahead.

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7.5.2

Theories of Development

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Objective and Essential Learning

7.5 Explain different theories of economic and social development.

7.5.1 Different theories such as Rostow’s Stages of Economic Growth, Wallerstein’s World System Theory, dependency theory, and commodity dependence, help explain spatial variations in development.

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How can we explain spatial variations in development?

Rostow’s Stages of Economic Growth (aka Modernization Model)
Wallerstein’s World Systems Theory (aka Core-Periphery Model)

Dependency Theory

Brandt Line (aka North-South Divide)

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Wallerstein’s World System Theory

Wallerstein explains the spatial relationships between countries and explains uneven economic development.

Interdependence

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Wallerstein’s World System Theory

There is a world economic system - one large interconnected economy. �
What characterizes Wallerstein?
Legacy of colonialism = advantages in production for the core countries.

How can a country develop when its resources (natural and human) are controlled by a handful of the prosperous industrialized countries?

Competition between core countries for colonies & trade.
Military strength

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Core-Periphery Model

Economically & politically dominant Strong military & allies Highly interconnected transportation & communication infrastructure Control of the global market. Businesses are headquartered here. Former colonial powers Higher skill, capital-intensive production. US, UK, Japan, Australia, Germany	“Middle Income” countries Aspects of the core & the periphery In the process of industrialization Active in manufacturing and exporting goods and raw materials. Better transportation & communication than the periphery NICS are BRICS Brazil, Russia, India, China, South Africa, Mexico	Often have unstable governments. Less wealth, lower levels of education than the core. Export natural resources to core & semi-periphery. Not reliable transportation or communication infrastructure. Former colonies Low skill, labor-intensive jobs, low wages. Weak laws to protect workers. Afghanistan, Peru, Kenya

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Dependency Theory

Sends cheap labor & natural resources to the SP & C countries.

Sells consumer goods and provides $$ flow to the SP & P

Buy raw materials
Pay for cheap labor
Sell consumer goods for high prices.

Pay high prices for consumer goods, which depletes $ supply and opportunities for investment.

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Applied to a Country Level Scale

Economically & politically dominant Highly interconnected transportation & communication infrastructure Control of the market. Businesses are headquartered here. Higher skill, capital-intensive production. Major cities US- NY & Chicago	“Middle Income” Aspects of the core & the periphery Active in manufacturing and exporting goods and raw materials. Better transportation & communication than the periphery Second-Tier Cities US - Cincinnati, Atlanta	Less wealth, lower levels of education than the core. Export natural resources to core & semi-periphery. Not reliable transportation or communication infrastructure. Low skill, labor-intensive jobs, low wages. US - Rural Areas

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Brandt Line (aka the North-South Divide)

Spatial analysis of development �
Generally,MDCs are in the northern hemisphere and LDCs are in the southern hemisphere.�
Fallen out of favor due to the development of many NICs that are located in the southern hemisphere.

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Objective and Essential Learning

7.5 Explain different theories of economic and social development.

7.5.1 Different theories such as Rostow’s Stages of Economic Growth, Wallerstein’s World System Theory, dependency theory, and commodity dependence, help explain spatial variations in development.