Rostow’s development model is still relevant, ask China

Those who have studied development economics, economic history, development finance, ICT for development, gender and development, political economy of development,  or communication for development are likely to have heard about or read Walter Whitman Rostow’s seminal publication, The Stages of Economic Growth: A Non-Communist Manifesto, first published by Cambridge University in 1960.

Of course, Rostow wrote other books, such as The Population Spike and After, Theories of Economic Growth from Hume to the Present, Why the Poor get richer and the Rich slow down, and Politics and the Stages of Growth.  But, it is for the Stages of Economic Growth that he is best known.

In the Stages of Economic Growth, Rostow perceives society as going through five stages. All societies start off as traditional in their set up; then they consciously put in place pre-conditions for take-off; they take-off; they drive to maturity, and eventually they attain the stage of mass consumption.

To summarise, Rostow views traditional society is being characterized by subsistence agriculture, crude tools for work, no investment and no savings culture, no industry, and no urbanisation.  

With time, society grows and its people get more organised and ‘enlightened’. They industrialise and urbanise. Rural society starts dying as mass society develops.  They start developing or adopting technologies for processing or adding value to raw materials from agriculture and other sectors such as mining. They start taking risks, saving and investing for profits. They develop organised financial and tax systems and political governance systems emerge. Rostow calls these processes the stage of preconditions for take-off.

This stage, according to Rostow, may take more than a century. 

Then society advances into the third stage, which he calls it the take-off. During this take off stage, and because of the groundwork laid in the preconditions for take-off stage, society experiences a 5-10 percent rise in the proportion of investment to national income. The economy advances towards self-sustenance.

The next stage,  fourth stage,  the drive to maturity when the economy is automatically self-sustaining and fast growing. The industries that helped in the economic take-off stage  gradually give away to other sectors  such as the service sector (banking, consulting, etc) culminating in the fifth stage, the stage of high mass consumption, when all is well (kudya katatu; kukhuta nkutayako; mwana alirenji). Per capita incomes are so high that people in society start spending part of their incomes on luxuries and even philanthropy. This is that stage of self-actualisation Abraham Maslow talked about as early 1962.

Naturally, Rostow has been criticised for being too simplistic and for conceiving economic growth as linear. Other critics have argued that some stages identified by Rostow may overlap and be ‘leaped over’. 

However, Rostow’s basic propositions are important. Without slowly and consciously graduating from subsistence agriculture, industrialising, urbanising, and setting in place critical and durable infrastructure such as roads, ports, rail, telecommunications, education institutions, and other critical development “seeds”,  self-sustaining economic growth  will be unattainable.

The literature on Chinese development policy shows that over decades the Communist Party of China, the sole governing party there since 1949, has modified its adherence to state economic regulation and allowed in a measure of capitalism.

Officially, China’s political system is one-party democracy, or democratic dictatorship, where the wishes the people, from grassroots to the top echelons, dictate party and national policy. Party leaders merely implement those popular desires and wishes.

Economic policies are capitalist in design with very little central control. 

In today’s China, citizens are allowed to own property and assets which is unlike in typical communism or socialism as conceived by Karl Marx.  China practices socialism with Chinese characteristics.

Like in capitalist countries where social security is guaranteed to alleviate poverty, China has deliberate social programmes aimed at uplifting poor people, especially in rural areas, from abject poverty. 

Rural urban centres are deliberately developed in areas with critical natural resources. Those that are known for basketry may see their area urbanise and develop industry around basket making.

China, from Mao to Xi, must have read and believed in Rostow and abandoned the Marxist-Leninist political and economic model where the proletariat, the masses, the poor overthrow the ‘exploitative’ bourgeois.

Instead, China is encouraging the ‘bourgeozification’ of the proletariat by graduating its rural poor from subsistence agriculture through industrialisation, urbanisation, and ownership of capital and other assets. 

The country is marching towards stage of mass consumption faster than Rostow dreamed.

Nanga ife, at what stage are we? Traditional, Precondition for Take-off, Take-off; Drive to maturity or mass consumption?  China moved from traditional to maturity and early mass consumption in under 60 years.  Where will be when Malawi celebrates its 60 years of existence in 2024?