The stage of the Rostow Model in economic growth is one of the best historical models that demonstrate the linear growth of the economy of a country. It was first published by an economist in the USA named Walt Whitman Rostow in the year 1960. This model applies to any set of society and is viewed from the perspective of the market economy. The famous five stages of Rostow’s model of economic development are as follows.
The Traditional Society
The characteristics of the traditional society in Rostow’s model are dependent on a number of factors. There is an existence of a subsistence economy and barter system in a traditional society where the output is not recorded nor traded. People in this society have a capacity of collection to increase the productivity of the economy due to a lack of knowledge in the scientific and technical segments.
However, inheritance and family traditions have more value and there is a presence of high-level agriculture with intensive labor. Landowners control the political scenario of the region in traditional society.
Preconditions of the Take Off
The preconditions for the take-off in the model are there will be the development of increased capital use in the mining industries and the agriculture sectors. There is notable growth in investments and savings. Also, there is a necessity for external funding in the area.
A rapid increase in the population, acceptance of technology, growth of education and banks, and the efficiency in farming are some of the scenarios that are observed in this stage.
The main characteristics of the take-off stage in Rostow’s model of economic growth are an increase in industrialization, investment, and savings are observed. The number of people working in the agricultural sector is reduced. There is an enormous increase in output and wages per person.
The country takes advantage of the benefits of the industries. There is also a widespread development of literacy due to the compulsory education system. In this stage, there is an improvisation in healthcare and life expectancy.
Drive to Maturity
The idea of growth becomes self-sustaining in the drive to maturity stage, which enables the generation of wealth by investments in the infrastructures and industries. More diversified industries are present and different levels of technologies are used in this stage of Rostow’s model of economic growth. Society embraces changes, adapting to the latest technologies, education, and medical facilities.
The Age of High- mass Consumption
In the new age of high mass consumption, there is a high amount of employment in the industry sector and high levels of output are seen at this level. Most of the industries shift more towards services sectors like finance, government, and information.
Moreover, high production of materials, more value of social welfare, and standard quality of living are also present in this stage. There is a broad range of choices for the whole society as well as for individuals.
The Rostow’s model is a foreseeable acceptance of the Neoliberal trade strategies. It allow the base for the manufacturing unit of a given advanced political scenario to be relocated to the regions with a lower wage. Rostow’s model does not apply to the African and Asian countries.