Rostow’s Stages of Development is a model that analyzes the 5 steps that it takes to move from an agricultural society to a service-based economy. His main assumption in creating the model was that each country had some kind of comparative advantage. Critics of this model state that it does not account for colonial legacy or government corruption in developing countries.
The Five Stages Are:
The economy is focused on primary production and has little technical knowledge.
Preconditions to Takeoff
The country’s leadership begins to invest in infrastructure with some technical knowledge to stimulate the economy.
Economy shifts to industrialization and some labor shifts to factories with new urban infrastructure.
Drive to Maturity
Technical advancements power a country where workers mostly get skill-based education.
High Mass Consumption
Technical knowledge and education levels are high and an industrial trade economy develops.
Wallerstein's World Systems Theory
Wallerstein’s World Systems Theory attempts to explain the relationship between the core and periphery countries. This image below basically shows how the core benefits from the periphery and semi-periphery. This image also shows how the semi-periphery can benefit from the periphery while still benefiting the core.
The Dependency Theory holds that Less Developed Countries (LDCs) are highly dependent on foreign factories and technologies from More Developed Countries (MDCs) to provide employment and infrastructure. The LDCs in this theory get stuck in the continuous cycle of dependency on the MDCs which never allow their economies to fully develop.
Watch this video here for more on theories of development.
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