Economics(Paper-4) - Shivaji University

promote and enhance social welfare. First, larger resources are allocated to military
and foreign policies for achieving international recognition and external power and
influence. Secondly, the resources of mature economy be directed to promote the
welfare of society and thirdly, the state should direct its resources to the expansion of
consumption levels beyond the basic necessities of life like food, clothing and shelter.
Kindleberger (and not Rostow) illustrates these stages with a Gompartz or ‘S’
curve.
Further development
Income
1. Traditional
2. Preconditioning
3. Take-offTime
4. Maturity
5. Mass-Consumption
0
1 2 3 4 5
Time
The diagram shows that a typical growth path of an economy. ‘S’ curve states that
an economy starts its growth slowly, picks up gradually and then proceeds very rapidly
before slowing down at some late stage to become asymptotic at some limit.
B
Critical Examination of the Rostow’s Theory:
The important points of criticism against the Rostow theory are:
1. The technological Approach to Development is basically incorrect:
In Rostow’s model development is not the result of policies; policies are the result
of development. This cannot be accepted. This approach leads to logical confusion.
2. Leading Sectors may not ‘lead’:
Kuznets and Cairncross are of the opinion that leading sectors may not lead. If we
examine the development linkages of industries, we can find that cotton textile industry
of Manchester or automobile industry of USA did not bring all the development.
3. Stage overleap and Works spill over to the Next Stages:
Kuznets, Habakkuk, Cairncross and Meier have commanded that the things that
are supposed to happen in a particular stage, may spill over to other stages also.
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