LINEAR STAGE THEORY

The theorists of 1950s and early 1960s viewed the process of development as a series of
successive stages of economic growth through which all the advanced nations of the world had
passed. As all the modern industrial nations of the world were once undeveloped peasant agrarian
economies. Accordingly, their historical experience in transforming their economies from poor agri.
subsistence societies to modern industrial giants had important lessons for backward countries of
Asia, Africa and Latin America.

Rostow’s Stages of Economic Growth

1. Traditional Society, dominated by agriculture and barter exchange, and where science and
technology are not understood or exploited.
2. Pre-conditions to take-off, with the development of education and an understating of science,
the application of science to technology and transport, and the emergence of entrepreneurs and a
simple banking system, and hence rising savings.
3. Take-off, with positive growth rates in particular sectors and where organised systems of
production and reward replace traditional methods and norms.
4. Drive to maturity, with an ongoing movement towards a diverse economy, with growth in many
sectors.
5. High mass consumption, where citizens enjoy high and rising consumption per head, and where
rewards are spread more evenly.

Rostow’s work, like many other accounts of growth, points to the significance of the accumulation of
savings to achieve take-off – in this case as a necessary condition for the movement from traditional
to developed societies.