= The Stages of Economic Growth =

There are a pair of works known by this name: an article and a book expanding on the article.

'''The Stages of Economic Growth''' (DOI: [[https://doi.org/10.2307/2591077]]) was written by [[UnitedStates/WaltWRostow|Walt W. Rostow]]. It was published in the Economic History Review volume 12 (1959).

'''The Stages of Economic Growth, a Non-Communist Manifesto''' was written by Walt Whitman Rostow in 1960.

This article is largely about the latter.

The author's five stages theory goes as follows:

 1. Traditional society
    * Low production, mostly devoted to agriculture
    * Low socioeconomic mobility with power concentrated in the landed
    * pre-Newtonian philosophy/science
      * "Newton is here used as a symbol for that watershed in history when men came widely to believe that the external world was subject to a few knowable laws, and was systematically capable of productive manipulation." (p.4)
 2. Preconditions for take-off
    * Western Europe experienced a gradual take-off, rest of the world experienced a sudden (sometimes literal) invasion
    * Capital has to become held by those who will invest into infrastructure and education, rather than ornamentation
      * Justifiable by either capitalism and nationalism
    * Communication, transportation, and trade all widen
    * Financial institutions emerge
 3. Take-off
    * Early investments into manufacturing yield high returns, which are largely re-invested
      * High investment rate should be visible indicator of stage
    * Agriculture becomes more efficient
    * Trickle down economics lifts everyone's quality of life
 4. Drive to maturity
    * Economy outgrows population
    * Extractive export industries replaced by 'mature' industries
    * Society reorganizes to fit around new economy
 5. Age of high mass-consumption
    * Industries arrive to durable consumer goods and services
    * Substantial population living above subsistence level
    * Urbanism
    * Investment into welfare and security rather than growth
 6. Beyond consumption
    * Author believed the U.S. was building into a sixth stage contemporaneously
    * Baby boom
    * Disinterest in growth

The author interprets the differential experiences of European powers through a lens of old landed elite vs. new economic elite.

More generally, the author looks for 'sharp stimuli' that rearrange society and trigger self-reinforcing growth; usually a political revolution. 

The author classifies industries as:
 1. Primary growth sectors, which involve necessities with inherent value.
 2. Supplementary growth sectors, which involve inputs to industrialization. Effectively extractive industries which have no inherent value for a traditional society but do for a country in take-off.
 3. Derived growth sectors, which grow in proportion to real incomes.



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