A Developing World: Comparing Countries and Economies Part II

Rostow’s Model A theory on the stages of economic development Describes a country’s position within their economic development how they progress socially and economically towards a higher stage

Rostow’s Model

Stage 1: Traditional Society Dominated by subsistence agriculture Limited potential for economic and population growth Outbreaks of disease, and natural controls such as droughts, cause limited economic and social progress Government structures are inflexible (monarchies and dictatorships)

Stage 2: Preconditions for Takeoff Country advances to a more complex economy, beginning their economic development Generally requires a surplus of wealth, which can be reinvested Transportation, communications, and natural resource exploitation More effective and responsive government control

Stage 3: Takeoff Introduction of technological innovations create dramatic changes in the country’s economy Agriculture progresses away from subsistence toward primarily commercial Manufacturing becomes a more important part of the economy Growth of cities and the numbers of paid workers as economy expands

Stage 4: Drive to Maturity Extended period of growth is sustained after a country’s economy reaches take off Per capita wealth increases as economic gain outpaces population growth Economy becomes more diversified Modern production methods come into use Increased percentage of the nation’s wealth is invested into developing its economy

Stage 5: High Mass Consumption Individual incomes are greater than necessary for buying essentials Due to the high incomes, there is a growing demand for additional consumer goods and services Improved health care systems and educational opportunities result from the wealth of the society

Rostow’s Model As a country progresses through the stages… Incomes rise A lower % of the population is involved in agriculture and a greater % is involved in industry Urban populations increase Health (infant mortality, life expectancy) increase, as does education (literacy rates, school enrollment, post-secondary education)

Criticisms of Rostow’s Model Western-centric Too vague, too much variation among countries Doesn’t account for the variety of ways that a country can develop Key is to keep in mind that it’s a model of economic development, not overall development Just because a country has a more developed economy, doesn’t mean it’s “better” or more developed overall

Core-Periphery Model The countries of the world can be divided into two major world regions Core = major world powers + the countries that contain much of the wealth of the planet Periphery = countries that are not reaping the benefits of global wealth and globalization

Core-Periphery Model Basic principle is that as general prosperity grows worldwide, the majority of that growth is enjoyed by a 'core' region of wealthy countries Severely outnumbered in population by the 'periphery' 15% of the global population enjoys 75% of the world's annual income

Core-Periphery Model

The Core Traditionally, Europe Also the United States, Canada, Australia, New Zealand, Japan, South Korea, and Israel Within this region is where most of the positive characteristics of globalization typically occur: Higher wages, access to healthcare, adequate food/water/shelter Scientific innovation Increasing economic prosperity High industrialization

The Core High on the HDI Top 20 all in the core However, most core countries also have stagnant or even declining population growth

The Periphery Africa, South America, most of Asia (excluding Japan and South Korea), and Russia and many of its neighbors Some parts of this area exhibit positive development, but generally characterized by extreme poverty and a low standard of living Non-existent health care Less access to potable water Poor infrastructure and slum conditions Skyrocketing population

How did this happen? Dependency Theory Capitalist countries have exploited the periphery through colonialism and imperialism Raw materials extracted from the periphery through slave labor, sold to core countries where they would be consumed, or manufactured and sold back to the periphery Advocates of this theory believe that the damage done by centuries of exploitation have left these countries so far behind that it is impossible for them to compete in the global market

How did this happen? Core nations also played a key role in establishing political regimes during post-war reconstruction European languages remain the state languages for many non-European countries long after their foreign colonists have left Makes it difficult for anyone brought up speaking a local language to assert themselves in a Eurocentric world Public policy formed by Western ideas may not provide the best solutions for non-Western countries and their problems