W W Rostow,The StâgesofEconomic Gro$'th: A Non-Communist... http://uvwmtholyoke.edûacad/intrelrpe/ronow.

htm

W.W. Rosto% TheStagesof Economic Grawh: A Non-CommunistMunifesto

(Cambridge:CambridgeUniversityPress,1960),Chapter2, "The Five Stagesof
Growth--A Summary" pp, 4-16

CIIAPTER 2

TIIE FIVE STAGES.OF.GROWTII.-A SUMMARY

It is possibleto identifyall societies,

in theireconomicdimensions, aslying within oneoffive
catego.ies:the traditional society,the preconditionsfor take-off,the take-off,the drive to matu.ity, and
theageofhigh mass-conslunption.

TÏIE TRADITIONAL SOCIETY

First,thetraditionalsociety.A traditionalsocietyis onewhosestructureis developed

within limited
productionfunctions,basedon pre-Newtonianscienc€andtechnology,and on pre-Newtonianattitudes
towardsthe physicalworld. Newton is hereusedasa symbol for that watershedin history whenmen
camewidely to believethat the externalworld wassubjectto a few knowablelaws, and was
systematiÇallyçapableof productivemanipulation.

The conceptionofthe taditional societyis, however,in no sensestatic;and it would not exclude

increasesin output.Acreagecould be expanded;somead ioc technicalinnovalions,often highly
productiveinnovations,could be introducedin trade,industryandagiculture; productivity could rise
with, for example,the impovement ofinigation works or the discoveryanddiffusion ofa new crop.
But the cenfal fact aboutthe faditional societywasthat a ceiling existedon the level ofattainable
outputper head.This ceiling resultedfrom the fact that th€ potentialitieswhich flow from modem
scienceandtechnologywereçither not availableor not regularly andsystematicallyapplied.

Both in the longerpastandin recenttimesthe story of traditionalsoçietieswasthusa story of endless

change.The areaandvolumeoftrade within them andbetweenthemfluctuated,for example,with the
degreeofpolitical andsocialturbulence, theefficiencyofcentralrule,theupkeepofthe roads.
Population-and,within limits, the level oflife-rose andfell not only with the sequenceofthe
harvests,but with the incidenceofwar and ofplague. Varyingdegreesofmanufactured€veloped;bu!
asin agriculture,the levelofproductivitywaslimitedby the inaccessibility ofmodemscience,its
applications,aad its frameofmind.

Generallyspeaking,thesesocieties,becauseofthe limitation on productivity,hadto devotea very high

Foportion oftheir resourcesto agricultue; andflowing from the agdculturalsystemtherewasan
hierarchicalsocialstructwe,with relatively narrowsçope--butsomescope-for vertical mobility.
Family andclan connexionsplayeda largerole in socialorganization.The value systemofthese
societieswasgenerallygearedto what might be calleda long-runfatalisq that is, the assumplionthat
the rangeofpossibilities opento one'sgrandchildrenwould bejust aboutwhat it hadbeenfor one's
grandpaxents. But this long-runfatalismby no meansexcludedthe short-runoption that, within a
considerablerange,it waspossibleandlegitimatefor the individual to shive to improvehis lot, within
his lifetime.In Chinesevillages,for example,therewasan endlesssfuggleto acquireor to avoid
losing land,yielding a situationwhereland rarely remainedwithin the samefamily for a century.

Although centralpolitical rule--in oneform or another--oftenexistedin ûaditional socigties,

transcendingthe relatively self-sufficientf€gions,the centreof graviq/ ofpolitical powergenerallylay

l of 9 21.O2.2012
2l:24
W W Rosl,os.The S.agesof FcoromicGo\ah q \on-Communisl hfip://www mtholyoke.edu/rcadliûtrel/ip€./rostow.
htm

in the regions,in the handsofthose who ownedor controlledthe land. The landownermaintained
fluctuatingbut usuallyprofoundinfluenceoversuchcentralpoliticalpowerasexisted,backedby its
enlourage ofcivil seûantsandsoldiers,imbuedwith attitudesandconholledby intereststranscending
theregions.

In termsofhistorythen,with thephrase'traditionalsociery'wearegroupingthewholepre-NeMonian
in China;thecivilizationofthe MiddleEastandtheMediterraneaq
world : thedynasties theworldof
medievalEurope.And to themwe addthe post-NeMoniansocietieswhich, for a tim€, remained
untouchedor unmovedby man'snew capabilityfor regularlymanipulatinghis environmentto his
economicadvantage.

To placetheseinfinitely various,changingsocietiesin a singlecategory,on the groundthat they all

shareda ceiling on the productivity oftheir economictechniques,is to sayvery little indeed.But we
are,afterall, merelyclearingtheway in orderto getat thesubjectofthis boob thatis, the
post-traditonalsocieties,in whicheachofthe majorcharacteristics ofthe traditionalsocietywas
alteredin suchwaysas1opermit regulargrowth: its politics, socialstructurc,and(to a degee) its
values,aswell asits economy.

THE PRECONDITIONS
FORTAKE-OFF

The secondstageof$owth embraces in theplocessoftransitiontthatis, theperiodwhenthe

societies
preconditionsfor take-off aredeveloped;for it takestime to transforma traditional socieryin the ways
necessary for it to exploitthefruitsof modemscience, to fendoffdiminishingretums,andthus!o
enjoy the blessingsand choicesopenedup by the marchofcompound intercst

Thepreconditions for take-offwereinitiallydeveloped, in a clearlymarkedway,in WestemEuropeof

the late seventeenthandeady eighteenthc€nturiesasthe insightsofmodem sciencebeganto b€
translatedinto n€w productionfunctionsin both agricultur€and industry,in a settinggiven dynamism
by the lateml expansionof world marketsandthe intemationalcompetitionfor them.But all that lies
behindthe break-upof the Middle Ages is relevantio the creationof the preconditionsfor take-otr in
WestemEurope.Among the WestemEuropeanstates,B tain, favouredby geography,natural
resources,tradingpossibilities,socialandpolitical structure,wasth€ first 1odevelopfully the
pre€onditions for take-ofl

The moregeneralcasein modemhistory,however,sawthestageofpreconditions arisenot

€ndogenously but from someextemalintrusionby moreadvanced Theseinvasionsliteralor
societies.
figurative-shockedthe traditional societyandbeganor haslenedits undoing;but they also setin
motionideasandsentiments whichinitiatedtheprocess by whicha modemaltemativeto the
traditional societywasconstructedout ofthe old culture.

The ideaspreads not merelythateconomicprogress hut thateconomicprogress

is possible, is a
necessary conditionfor someotherpurpos€,judged to be good:b€ it nalionaldignity,privateprofit,the
generalwelfare,or a beûerlife for the children.Education,for someat least,broadensandchangesto
suittheneedsofmodemeconomicactivity.New typesofenterprisingmencomeforward*inthe
private economy,in govemment,or both--willing to mobilize savingsard to takedsks in pursuit of
plofit or modemization.Banksandoth€r institutionsfor mobilizing capitalappearInvestment
increases,notably in transport,communications,andin raw materialsin which othernationsmay have
an economicinterest.The scopeofcommerce,internalandexternal,widens.And, hereandthere,
modemmanufacturing ent€rprise
appears, usingthe newmethods. But all this acûviryproceeds at a
limited pacewithin an economyanda socierystill mainly characterizedby traditional low-Foductivity
methods,by the old social structue andvalues,andby the regionallybasedpolifical institutionsthat

2 o19 21.02.201221:24
ww Rostow.The StâsesofEconomicGroù,th:ANon-Communist... htto://www mtholvokeedr/acâd/intrel/iDe/rostowhùyr

developedin conjunctionwith them.

In rnanyrecentcases,for example,the traditionalsocietypersistedsideby sidewith modem€conomic

for limitqdeconomicpurposes
açtivities,conducted power
by a colonialor quasi-colonial

Although the periodoftransition:between the taditional societyandthe take-off-saw major changes

in boththeeconomyitselfandin thebalanceof socialvalues,a decisivefeaturewasoftenpolitical.
Politically,thebuildingofan efectivecentalizednationalstate--on thebasisofcoalitionstouched
with a new nationalism,in oppositionto the traditionallarded regionalinterests,the colonial power,or
both, wasa decisiveaspectofthe Fecondilionsperiod:andit was,almostuniversally,a necessary
conditionfor tak€-ofï

Thereis a greatdeal morethat needsto be saidaboutthe preconditionsperiod,but we shall leaveit for

chapter3, whereth€ anatomyofthe transitionfrom a traditjonalto a modemsocietyis examined.

THE TAKE-OFF

We com€now to the greatwatershedin the life ofmodem societies:the third stagein this sequence,
the ake-off The take-offis the intervalwhenthe old blocksandresistancesôosteadygroMh are
finally overcome.The forcesmakingfor economicprogress,which yielded limited bu6ts and enclaves
ofmodern activiq/, expandandcome1odominatethe society.Growth b€comesits normalcondition.
Compoundinterestbecomesbuilt, as it were,into its habitsandinstitutionalstructule.

ln Britain andthe well-endowedpartsof the world populatedsubstantiallyûom Britain (the United

States,Canadaetc.) the proximatestimulusfor take-offwasmainly (but not wholly) technological.In
the more generalcase,the take-offawaitednot only the build-up ofsocial overheadcapitaland a surge
oftechnological developmentin industryandagriculture,but alsothe emergetrce to political powe! of
a group preparedto regardthe modemizationofthe economyasserious,high-orderpolitical business.

During the take-off,the rate ofeffective investmentandsavingsmay rise from, say,5 0%ofthe national
incometo 100% or more;althoughwherehealy socialoverheadcapitalinvestmentwasr€quiredto
createthe technicalpreçonditionsfor take-offthe investmentratein the preconditionsperiod could be
higherthan 5%, as,for example,in Canadabeforethe 1890'sandArgentiûabefore 1914.In suchcases
capital importsusually formeda high proportionoftotal investmcntin the preconditionsperiod and
sometimesev€ndurirg the take-off itself, asin RussiaandCanadaduring their pre-1914railway
booms.

During the iake-offnew indusûiesexpandrapidly,yielding profits a largeproportionofwhich are

reinvested in newplanqandthes€newindustri€s, though theirrapidlyexpanding
in tum, stimulate,
requiremenlfor faclory workers,the servicesto suppo( them,andfor othermanufacturedgoods,a
further expansionin urbanareasand in othermodernindustrialplants.Tbe whole proc€ssofexpansion
in the modernsectoryields an increaseof incomein the handsof thosewho not only savea1high rates
but placetheirsavingsat thedisposalofthoseengaged in modemsectoractiviti€s.Thenewclassof
entrepreneurs expands;andit directsthe enlargingflows of investmentin the private sector The
economyexploitshithertounusednaturalresourcesandmethodsof production.

New techniquesspreadin agricultureaswell asindustry,asagdaulhre is commercialized,and

increasingnumben offa.mers arepreparedto acceptthe new methodsandthe deepchangesthey bring
to ways oflife. The revolutionarychangesin agriculturalproductivityare an essentialconditionfor
successfultake-off; for modemizationofa socieryincreasesradically its bill for agricultunl Foducts.
In a decadeof two both the basicsfuctule ofthe economyandthe socialand political sauctureofthe
socieryare transformedin sucha way that a st€adyrate of gro!'vthcanbe, thereafter,regularly

3 of9 21 02.2Ol221:24
WW Rostoq TbeStagesofEconomicG.owth:A Non-Communist.. http://wwiv mtholyok€.edu/acadlintrel,4pe/rostowhtm

su$alneo.

As indicatedin chapter4, onecanapproximatelyallocatethe take-offofBritain to the two decades

after 1783; Franceandthe United Statesto the severaldecadesprecedingI 860; Germany,the third
quarterofthe nineteenthcentury'Japan,the fourth quarterofthe nineteenthcentury;Russiaand
Canadathe quarter-centuryor so preaeding1914;while during the 1950'sIndia and Chinahave,in
quite different ways,larmchedtheir respectivetale-offs.

]}IE DRIVE TO MATURITY

After take-offtherefollows a long interval ofsusiainediffluctuatng progress,asthe now regularly

growing economydrivesto extendmodemtechnologyover the whole liont ofits economicactivity.
Some10-20%ofthe nationalincomeis steadilyinvested,permittingoutputregularlyto outstrip the
increasein population.The make-upofthe economychang€sunc€asinglyasûechniqueimprov€s,new
industriesaccelerate,older indust eslevel ofi The economyfinds its placein the international
economy:goodsform€rly importedareproducedat home;new import requirementsdevelop,arld new
exportçommoditiesto matchthem.The societymakessuchtermsas it will with the requirem€ntsof
modem€mcient production,balancingoff the new againstthe older valuesard institutions,or revising
the latter in suchways asto supportÉther thanto retardthe gro\athprocess.

Somesixty yearsafter take-offbegins(say,forry yealsafter the endoftake-off) what may be called

maturity is generallyattained.The economy,focusedduringthe take-offa.ould a relatively nar.ow
complexof industryandtechnology,hasextendedits rarge into morerefinedandtechlologically often
morecomplexprocesses; for example,theremay be a shift in focusftom the coal, iron, andheavy
engineeringindustriesofthe railway phaseto machine-tools,chemicals,andelectricalequipment.
This, for example,wasthe fiansition throughwhich Germany,Britaiq Ffance,andthe Uniied States
hadpassedby the endofthc nineteenthcenturyor shortlythereafter But thereareother sectoral
pattemswhich havebeenfollowed in the sequencefrom take-offûomatudty,which are consideredin
ahapter5.

Formally,we candefinematurity asthe stagein which an economydemonshates the capacityto move

beyondthe original industrieswhich poweredits take-of andto absorbandto apply efficiently over a
very wide rangeof its resoruces--ifnot the whole range--themost advancedfruits of (then)modem
technology.This is the stag€in which an economydemonstatesthat it hasthe technologicalard
entrepreneurialskills to producenot everything,but anythingthat it choosesto produce.It may laçk
(like contemporarySwedenand Switzerland,for example)the raw materialsor other supplyconditions
requiredto producea giventype of outputeconomically;but its dependence is a matterof economic
choiceor political priority ratherthan a teçhnologicalor institutionalnecessity.

Historically, it would appea.that somethinglike sixty yearswasrequircdto movea societyfrom the

beginningoftake-offto matu.ity.Analytically the explanationfor somesuchinterval may lie in the
powerful arithmeticof compoundinterestappliedto the çapitalstock,combinedwith the brcader
consequenc€s ofthree successivegenerationsliving
for a society'sability to absorbmodemteahnologS/
undera regimewheregrowth is the normalcondition.But, clearly,no dogmatismisjustified aboutthe
exactlengthofthe interval from take-offto maturity.

THE AGE OF HIGH MASS-CONSLMPTION

Wecomenow to theageofhigh mass-consumption, where,in time,the leadingsectorsshjfttowards

durableconsumers'goodsand services:a phasefrom which Americansarc beginningto emeige;
whosenot uequivocal joys WestemEuropeandJapanarebeginningeneryeticallyto probe;andwith
which Sovietsocietyis engagedin an uneasyflirtation.

4 of 9 2l.O2.2012
2l:24
WW Rostow-TheStaqes
ofEconomicGrowthrANon-Communist... http://rlww.mtholyokeedl/acaMnEel/ipe/rostow.htm

As societiesachievedmaturiryin the twentiethcenturytwo thingshappened:real incomeper headrose

to a point wherea largenumberofpersonsgaineda commandover consumptionwhich transcended
basicfood, shelter,and clothing; andthe structureofthe working forc€ changedin wayswhich
increasednot only the proportionof urbanto total population,but alsothe proportionofthe population
working in ollices or in skilled factoryjobs-awareofand anxiousto açquirethe consumptionfruits of
a matwe economy.

In additionto theseeconomicchanges,the societyceasedto acceptths further extensionofmodern

technologyasan overridingobjective.It is in this post-matu.itystage,for example,thal, throughthe
political process,Westemsocietieshavechos€nto allocateircreasedresourcesto soçial welfareand
security.The€mergence ofthe welfareslateis onemanifestation ofa society'smovingbeyond
technical maturity; but it is alsoat this stagethat resourcesteûd increasinglyto be directedto the
productionof consumers' durables andto the diffusionofserviceson a massbasis,if consumers'
sovercigntyr€igns.The sewing-machine, the bicycle,andthenthe variouselectric-poweredhousehold
gadgetswere graduallydiffused.Historically,however,the decisiveelementhasbeenthe cheapmass
automobilewith its quite revolutionaryeffects--socialaswell aseconomic--onthe life and
expectations of society.

For theUnitedStates, thetumingpointwas,perhaps, HenryFord'smovingassembly line of l913-14;

but it was in the 1920's,and againin the post-war decade,1946-56,that this stageof groMh was
pressedto, virtually, its logiçal conclusion.In the 1950'sWestemEuropeandJapanappearto have
fully enteredthis phase,accountingsubstantiallyfor a momentumin their economiesquite unexpected
in the immediatepost-waryears.The SovietUnion is technicallyreadyfor this stage,ard, by every
sign,its citizenshungerfor iq but Communistleadersfacedimcultpoliticalandsocialproblemsof
adjustmentifthis stageis launched.

BEYOND CONSIMPÏON

Beyond,it is impossibleto predict,exceptperhapsto obsewethat Ame cans,at least,havebehavedin

the pastdecadeasifdiminishiDgrelativemarginalutility setsin, aftera point,for durableconsumers'
goods;andthey havechosen,at the margin,largerfamilies- behaviourin the pattemofBuddenbrooks
dynamics.*

* In ThomasMann'snovelofthreegenerations, the first soughtmoney;the second,bom

to money,soughtsocialandcivic positiontthe third, bom to comfort andfamily prestig€,
lookedto the life ofmusic. The phraseis designedto suggest,then,the changing
aspirationsofgenerations,asthey placea low valueon what theytake for grantedand
seeknew forms of satisfaction.

Am€ricanshavebehaved asif, havingbeenbom into a systemthatprovided€conomics€cudtyand

high mass-consumption, theyplaceda lower valuationolr acqui ng additionalincrementsofreal
incomein the conventionalform asopposedto the advantagesandvaluesofan enlargedfamily. But
evenin this adventur€in generalizationit is a shadetoo soonto create--onthe basisof onecas€--anew
stage-of-groMh,basedon babies,in succession to the ageofconsumels'durables:aseçonomistsmight
say, the income-elasticrty for
ofdemand babies may well vary from socictyto society.But it is true that
the implicationsofthe babyboomalong with the not wholly unrelateddeficit in socialoverhead
capital are likely 10dominatethe Americaneconomyover the next decaderatherthan the further
difusion ofconsi'mers'durables.

Here then,in an impressionisticratherthanan analyticway,arethe slages-of-groMhwhich canbe

5 of 9 21.02.2012
2l:24
 WW Rosloq the Stages
ofEconomiccrowth: ANon-Communist... http://www mtholyoke.edù/âcad/intrei/iDe/rostow.htrn

distinguishedoncea traditionalsocietybeginsits modemizationi thetransitionalperiodwhenthe

preconditionsfor take-offareqeatedgenerallyin response to the intrusionofa foreignpowel
convergingwith certaindomesticforcesmakingfor modemization;the take-off itself; the sw€epinto
maturitygenerallytakingup the life ofabouttwo furthergenerations; andthen,finaliy,rfthe riie of
incomebasmatchedthe spreadoftechnologicalvituosity (which, aswe shall see,it neednot
imrnediatelydo) the diversionofthe fully matule economyto the provisionofdurable consumerc,
goodsandservices(aswell asthe welfareslate)for its increasinglyurban_and then subùrban_
population.
Beyondliesthequestionofwhetheror not secularspiritualstagnation will arise,and,if it
does,how manmight fend it ofl a matterconsideredin chapter6.

ln the four chaptersthat follow we shalltake a hardet andmorerigorouslook at the preconditions,the

take-offthed ve to maturity,andtheprocesses whichhaveledto the ageofhigh mass-consumption.
But evenin this introductorychapteronecharacteristiçofthis systemshouldbe madeclear

A DYNAM]C TI]EORY OF PRODUCTION

Thesestagesare not merely descriptiv€_They are not merelya way ofgeneralizing certainfactual
observationsaboutthesequence ofdevelopment ofmodemsocieties. Theyhavean innerlogicand
continuiry.They havean analyticbone-structure,rooûedin a dynamictheoryofploduction.

The classicaltheoryofproduction is formulatedunderessentiallystaticassumptionswhich.freeze_or

permitonly once-over change-in thevariablesmostrelevantto the process oficonomic growth.As
modemeconomistshavesoughtto mergeclassicalproductiontheorywith Keynesianincomeanalysis
they haveintoduced the dynamicvariables:population,technology,entepreneurshipetc.But they
havetend€dio do so in forms so rigid andgeneralthat their modelscannotgrip the ess€ntial
phenomenaofgowth, asthey appearto an economichistodan.Werequireà dlnamic theory of
Foducûonwhichisolatesnot only thedistributionofinçomebetweenconsumption, saving,and
investment(andthe balanceofFoduction betweenconsume$andcapitalgooàs)but which focuses
direcdyandin somedetail on the compositionofinvestrnentandon developmentswithin particular
secto$ofthe economy.The argumentthat follows is basedon sucha flexible, disaggregaûed theory of
production.

Whentheconventional limits on thetheoryofproductionarewidened,it is possibleto define

theoretical
equilibriumpositionsnot only for output.rnvestment,
andconsumption asa whore,but rbr
eachsectorofthe economv*

* W.W Rostow,TlreProcessofEconomic
Grov,th(Oxford,l953),especiallychapterrv.
AIso'Trendsin thÊAllocationofResoucesin SecularGrowth,',chaÏler 15of bconomrc
Progre.rs,
ed.LeonH. Dupriez,with tle assislance
of DouglasC Hagle (Louvain,1955).

within the frarneworksetby forcesdeterminingthe total revelofoulput, sectoraloptimumpositions

aredeteminedon thesideofdemand,by the levelsof incomeandofpopulation,andby thecharacter
of tastes;on the sideof supply,by the stateof technologyandthe qualiry of €nfepreneushjp,asthe
latterdetermines theproportionoftechnicay availabre andpotentiay profitabreinnovations aÇtuay
incorpoËtedin the capitalstock.*

* ln a closedmodel,a dynamictheory
ofproductionmustaccountfor changilgstocksof
basicandappliedscience, assectoralaspects whichis donein I&e procers
ofinvesûnent,
ofE.onomi.Grovth. especially pp.22-5.

6of9
2t0220t2 21 24
WW Rostoq Th€Stages
of EconomicGro$th:ANon-Commùnist.. pe/rostow.htm
http://www mtholyokeedu/acad/intrel/i

In addition,one must introducean extremelysignificantempiricalhypothesis:namely,that

decelerationis the nomal optimumpathofa sector,dueto a variety offactors operatingon it, from the
sideofboth supplyanddemand.*

* I'rocets of EconomicGrowth,pp. 96-703.

The equilibria which emergefrom the applicationofthese crite a area setof sectoralpaths,from
which flows, asfirst derivatives,a sequenceof optimumpatt€msof investrnent.

Historical pattemsof investmentdid not, ofcourse, exactlyfollow theseoptimumpatterns.They were

distortedby imp€rfectionsin the privale investmentprocess,by the policiesofgovemments,andby
the impactof waIS.Warstempora ly alteredthe profitabledirectionsofinvestnent by settingup
arbitrarydemandsandby changingthe conditionsofsupply;they destroyedcapital;and,occasionally,
they acceleratedthe developmentof n€w technologyrelevantto the pea.c€lime economyand shiftedthe
political and socialframeworkin waysconduciveto peacetimegro*th.* The historicalsequenceof
business-cycles andtrend-oeriodsresultsfrom

* Prccessof EconomicGtowth, chapterVlL esp€ciallypp. 164-7.

thesedeviationsofactual from optimalpattems;and suchfluctuations,along with the impactofwars,

yield historical pathsof growth which diIïer from thqsewhich the optima,calculatedbeforethe event,
wouldhaveyielded.

Nevçrthçlçss,thç eçonomichistory ofgrowing societiestakesa part ofits rude shapefrom the €ffort of
soÇietiesto approximatethe optimumsectoralpaths.
At any periodof time, the rateof glowth in the sectorswill vary greatly;and it is possibleto isolate
empirically certainleadingsectors,at early stagesof their evolution,whoserapid rate of expansion
plays an essentialdirect andindirectrole in maintainingthe overall momentumofth€ economy.* For
someoulDoses 1tls

* For a discussionofthe leadingsectors,their direct ard indirect consequences:

andthe
diverseroutesoftheir impact, in
see'Trends the Allocation ofResources in Secular
Gro\t"'th',bc. cit.

usefulto characterizean economyin termsof its leadingsecto$,and a part of the technicalbasisfor

the stagesofgro\ath lies in the changingsequenceofleading sectors.ln essenceit is the fact that
sectorstendto havea rapid grou'th-phase,early in their life, that makesit possibleandusefulto regard
economichistory asa sequenc€of stag€sratherthanmerelyasa continuum,within which naturenever
makesaJump.

The stages-of-goMhalsorequire,however,that elasticitiesofdemandbe takeninlo account,andthat

this familiar conceptbe widened;for theserapid growth phasesin the sectorsderivenot merely from
the discontinuityof productionfunctionsbut also from high price- or income-elasticitiesof demand.
Leadingsectorsaredetenined not merelyby the changingflow oftechnology andthe changing

7 of 9 2l.02.201221:24
WW. Rosto\ The Stages
ofEcononic Grolrth:ANon'Communist... httDr/ r'wwmtholvoke.eôtacadintrel/iDdrostowhtm

willingnessofentreprençursto aaçeptavailablginnovations;they are alsopartially determinedby

thosetypesofdemandwhichhaveexhibitedhighelasticitywith respectûopric€,income,or both.

The demandfor resourceshas.esulted,however,not merelyfrom demandssetup by privatetastçand

choice,but alsofrom socialdecisions andfromth€policiesofgovernm€fis--wheth€r democratically
responsive or not.It is necessary, to lookat thechoicesmadeby societies
therefore, in thedisposition
oftheir resourcesin termswhichtnnscendconvenlional marketprocesses.
It is necessaryûolook at
theirwelfarefunctions,in th€widestsense,includingthe non-economic processes whichdetermined
them.

The courseofbirth-rates,for example,.epresents oneform ofwelfarechoicemadeby societies, as

incone haschanged;andpopulationcurvesreflect (in additionto changingdeath-rates)how the
calculusaboutfamilysizewasmadein theva ousstages; from theusual(butnot universal)declinein
birth-rates,during or soonafter the take-off,asurbanizationtook hold and progressbecamea palpable
possibility,to the recent se,asAmericans(and othersin societiesmarkedby high mass-consumption)
haveappearedto seekin largerfamilies valuesbeyondthosealTordedby economicsecu ty andby an
amplesupplyof dwable consumers'goodsand services-

And thereare otherdecisionsaswell that societieshavemadeasthe choiçesopento them havebeen

alteredby the unfolding processof economicgro*th; andthesebroadcollectivedecisions,determined
by many factors-deepin history culture,andthe activepolitical Focess-outsidethe market-place,have
interplayedwith the dynamicsofmarket demand,risk-taking,technologyandentrepenewship,to
determinethe specificcontentofthe stagesofgrowth fof eachsociety.

How, for example,shouldthe traditionalsocjetyreactto the intrusionof a moreadvancedpoweri with

cohesion,promptness,and vigour, like the Japanese;
by makinga virtue iffecklessn€ss,like the
oppressedIrish ofthe eighteenthc€ntuy: by slowly andreluctantlyalteringthe haditional society,like
the Chincse?

When independentmodemnationhoodis achieved,how shouldthe nationalenergiesbe disposed:in

extemalaggression,to ght old wrongsor to exploitnewlycrcatedor perceived possibilities
for
enlargednationalpower; in completingard refining the political victory ofthe new national
govemmentover old rcgionalinter€sts,or in modemizingthe economy?

Onc€growth is underway,with the take-ofï,to what extentshouldthe requirementsofdiffusing

moderntechnologyand maximizingthe rateofgrowth be moderatedby the desireto increase
consumptionper capitaandto increasewelfare?

Whcntechnological maturiryis reached,andthenationhasat ih commanda modemized and

differentiatedindustrialmachine,to what endsshouldit be put, andin what proportions:to increase
social secu ty, throughthe welfare state;to expald mass-consumptioninto the rangeof durable
consumels'goodsard servic€s;to incrqasethe nation'sstatureandpoweron the world sçene;or to
increase leisule?

And thenth€ questionbeyond,wherehistory offers us only fragments:what to do whenthe increasein

real incomeitself losesits charm?Babies,boredom,three-dayweek-ends,the moon,or the creaton of
new inner,humanfrontiersin substitutionfor the imperativesofscajcity?

ln surveyingnow the broadçontowsofeaah stage-of-gro\th,we areexamining,then,not merely the

sgctolalstructureofeconomies,asthey hansfomed themselvesfor growlh, andgrew; we are also
examininga succession ofstrategicchoicesmadeby varioussocieties
conceming the dispositionof
theû resources,which includ€but ûanscendthe income-andp ce-elasticitiesof demand.

8 of 9 21.02.2012
21:24
W W Rostow.The Stacesof EconomicGror\lh: A Non-Communist. http //www mlholyoke edu/acad/jntrel/ipe/rostowhtm

l?chtrnto Jlnnia'.rth)!r1!Jlug!

!lqat!a !a (i!!'hL!!L!!)!Ltall!c!

lt e4tLt4ttLll liL!!!s!

to 11'liSvllubll
lfal1urn

9 of9 21.O22012 21 24