7.5 HGAP KBAR

-concept of economic development- relatively short (emerged after WW2)

-low standards of living concerned scholars (maybe bc imperalism and colonialism)

-Economist Walter W. Rostow developed Rowstow’s stages, one of the most earliest and influential models

Rowstow’s Stages of Economic Growth include five distinct phases: 1) Traditional Society, 2) Pre-conditions for Take-off, 3) Take-off, 4) Drive to Maturity, and 5) Age of High Mass Consumption.

-all countries progress individually through five development stages

-last stage- high consumption societies, rich and wealthy

stage 1- traditional society (barter, subsistence, agriculture)

stage 2- transitional stage (specialization, infrastructure, and ag surplus)

stage 3- take-off (political change, industrialization, regional growth, investments)

stage 4-drive to maturity- (diversification, innovation, less reliance on imports

stage 5- final stage- high mass consumption, service sector, customer durable goods

Rostow compared his model to an airplane taking off: as the economy progresses through each stage, it gains altitude, ultimately reaching the final stage where it can glide towards sustained economic growth and consumption.

Of course, this model isn’t without criticism: it assumes that all countrise develop independently of each other (not true because of imperialism and coloniaism) and mainly because we can see how economic exploitation can impede development in a specific region.

Another rival model emerged later, Wallerstein’s World System Model, created by the socioloigst Immanuel Wallesterin. He organized the countries of the world into three categories: core, semi-periphery, and periphery countries.

Unlike Rowstow’s theory, he proposed that countries move interdependentlyl through socioeconomic systems.

Core regions are the ones that industrialized first: North America, Japan, Western Europe. They have the highest and advanced tech, highest levels of comsuption, and it goes without saying that these nations also exert significant political and economic influence on a global scale, shaping international trade agreements and setting trends that affect peripheral and semi-peripheral regions.

The periphery on the other hand consists of countries that are less developed and are typically marginilized of economic and political power, such as Sub-Saharan Africa and some parts of Latin America. These regions have economies focused on agriculture and the primary and secondary sector. The middle one, the semi-periphery, consists of countries such as Mexico, India, and Brazil, that are in transition towards becoming more developed by enhancing their industrial capabilities and integrating further into the global economy. The model uses the international division of labour and emphasizes that core countries often actively underdeveloped the periphery through imperilaism and colonialism, in the role they played in shaping global economic structures that favor their own growth at the expense of peripheral nations.

• a country’s status can change over time in either direction.

• The World Systems Theory has been criticized for providing a sweeping world generalization view, glossing over the complexitiies in the world regions and subregions. Thus, its more useful as a global scale.

• The world systems theory builds upon an earlier theory: the dependency theory. It says the reason why the periphery is poor is bc of imperalism and colonialism. It emerged from the studies done on South American countries, where scholars were disillusioned by the faliures of developing countries.

• One of the reasons why is commodity dependence, in which 60% of the export economy consists of one particular good (Venezuela- crude petroleum oil).

• Commodity dependency occurs in around ½ of the world’s economies (developing countries)

• Underdevelopment and commodity dependency are correlated because these goods aren’t stable on the market, they can fluctuate quickly, the good’s revenue stream is unpredictable, and in the long term, the prices of these commodities often decrease. Additionally, this reliance on a narrow range of exports often limits diversification in the economy, making countries vulnerable to external shocks and economic downturns that can lead to increased poverty and instability.

• However, rather than using the profits to help the periphery, these profits are often invested back into the core countries, perpetuating a cycle of dependency and hindering local development efforts.

• The solution to underdevelopment, the theory said was to unlink the core and the periphery’s exploitative relationship.

• It has been criticized for not considering the social and cultural variations between the core and the periphery. which might explain different spatial patterns of uneven development.

• Also, unlinking is a tedious process in the economy, especially with the globalization and the complexity of the world today.