Rostow’s stages of Economic Growth or Development Model.

1. Rostow’s stages of Economic Growth or Development Model. Proposed in the 1950s, this 5 stage model of development was adopted by several countries in the 1960s.

2. Rostow’s stages of Economic Growth or Development Model. • Each country is in one of these five stages of development.

3. Five Stage Model • The traditional society: A country that has not yet started a process of development. • The preconditions for takeoff: A group initiates innovative economic activities. Country invests in technology and infrastructure.

4. 3. The takeoff: Rapid growth in a few economic activities and achieve technological advances and become productive. 4. The drive to maturity: Modern technology spreads to a variety of industries and rapid growth occurs with more skilled labor.

5. The age of mass consumption: Economy shifts from production of industrial goods to consumer goods.

6. Model based on two factors: • The more developed countries have moved through the stages through resource development and international trade. • Many less developed countries had raw materials extracted by colonial powers without compensation.

7. Wallerstein’s World Systems Theory • The world economy has one market and a global division of labor. • Although the world has multiple states, almost everything takes place within the context of the world economy. • The world economy has a three-tier structure.

8. Wallerstein’s World Systems Theory European nations and those settled by European migrants established colonies throughout the world to extract wealth. This period of colonialism established the current imbalance in world economic and political power

9. Construction of the World Economy Capitalism – people, corporations, and states produce goods and services and exchange them in the world market, with the goal of achieving profit. Commodification – the process of placing a price on a good and then buying, selling, and trading the good. Colonialism – brought the world into the world economy, setting up an interdependent global economy.

10. Three Tier Structure • Core • Processes that incorporate higher levels of education, higher salaries, and more technology • * Generate more wealth in the world economy

11. Three Tier Structure • Periphery • Processes that incorporate lower levels of education, lower salaries, and less technology • * Generate less wealth in the world economy

12. Three Tier Structure • Semi-periphery • Places where core and periphery processes are both occurring. Places that are exploited by the core but then exploit the periphery. • * Serves as a buffer between core and periphery