socsci 102 week 12

• Modernization Theory


  Assumes that all countries follow a similar path to development or modernization advancing through 5 stages
• 5 stages of Modernization Theory

  • Traditional society
  • Pre-conditions for take-off
  • Take-off
  • Drive to maturity
  • Age of mass consumption
• Traditional society


  • Agricultural economy of mainly subsistence farming
  • Little of which is traded
  • Capital stock is limited and of low quality resulting in very low labour productivity and little surplus output left to sell in domestic and overseas markets
• Pre-conditions for take-off


  • Agriculture becomes more mechanized and more output is traded
  • Savings and investment grow although they are still a small percentage of national income (GDP)
• Take-off


  • Manufacturing industry assumes greater importance
  • Political and social institutions start to develop
  • Savings and investment grow, perhaps to 15% of GDP
  • Agriculture assumes lesser importance in relative terms although the majority of people may remain employed in the farming sector
  • Often a dual economy apparent with rising productivity and wealth in manufacturing and other industries contrasted with stubbornly low productivity and real incomes in rural agriculture
• Drive to maturity


  • Industry becomes more diverse
  • Growth should spread to different parts of the country as the state of technology improves
  • The economy moves from being dependent on factor inputs for growth towards making better use of innovation to bring about increases in real per capita incomes
• Age of mass consumption

  • Output levels grow, enabling increased consumer expenditure
  • Shift towards tertiary sector activity
  • Growth is sustained by the expansion of a middle class of consumers
• These stages suggest that a society moves from a traditional phase which is characterized by a lack of exposure to Western society, a lack of science or technology, a dependence on agriculture, and a high level of poverty to a modernized, industrialized, and developed economy
• Rostow argues that through increased investment, increased exposure to modernized, Western society, and changes in traditional culture and values, societies will become more highly developed
• It purports that what developing countries need is at least an initial stimulus from an outside source, a developed country perhaps, to jumpstart the process
• It, therefore, posits that internal development is unlikely
• The five stages are Traditional Society, Preconditions for Takeoff, Take-Off, Drive to Maturity, and Age of High Mass Consumption
• Traditional society is characterized by self-sufficient communities with little change over time. The economy is based on subsistence agriculture and there is no division between work and leisure. There is also limited social mobility and few opportunities for advancement.
• Preconditions for take off refers to the development of an entrepreneurial class who have access to capital and technology. This leads to increased productivity and economic growth.