Lesson video

Hello, geographers.

My name is Mrs. Griffiths and today's lesson is all about theories of development.

So we'll look at Rostow's theory of development over time and then we're gonna have a look at Frank's theory of development over time.

These are theories or ideas about how countries develop economically over time and helps us to understand the uneven pattern of economic development we see around the world or that development gap.

So, shall we get started? Our outcome for today is I can explain Rostow and Frank's theories about how and why countries develop over time.

So that's what I hope you can say by the end of the lesson.

We have some keywords today.

The first is extreme poverty, that is, living on less than $2.

15 a day.

Modernization theory, a view that suggests that countries move through five stages of economic development, as proposed by Rostow.

Manufacturing, the secondary economic sector, involving making goods from raw materials or other manufactured products, for example, motor vehicles.

And then we have dependency theory, a socialist view that explains how the core, that is, developed countries, exploit the periphery, that is, developing countries, and it's proposed by Frank.

So those are our keywords for today and that's what we're gonna be using today to understand the theories.

Okay, so our lesson has two parts today.

The first part is answering this question, how do countries develop over time? And then secondly, how and why are some countries held back? So let's take a look at that first one, how do countries develop over time? What are the UN's Sustainable Development Goals, which are international goals that countries are seeking to achieve by 2030 is to reduce poverty.

And that sustainable development goal number one includes the aim to eradicate extreme poverty for all people everywhere.

What do we mean by extreme poverty? People who live on less than $2.

15 a day are extremely poor and they lack enough food, clean drinking water, and sanitation, so have a really poor quality of life.

The share of the global population who live in extreme poverty is much smaller than it once was, and I want to tell you a little bit about that.

Here We have a distribution graph of the population of the world organised by income and we can see that is income in terms of dollars per day.

We've also got a colour code for the graph here because in fact we have four graphs located over the top of each other, I suppose, indicating income of the population.

Now, if I look at the date, this is a distribution graph showing the population by income in 1800.

So as I say, x-axis is your income per day and the y-axis is, if you like, the number of people of that income bracket.

So this distribution graph shows us the world's population located on the x-axis showing income in US dollars, but it also shows us the spread of incomes within regional populations.

And if we look closely then at that key, you can see that the people at Gapminder who produced this graph have organised the world into four different regions.

So we have Africa, Asia and Oceania are a single region there in pink, Europe, and the Americas.

Notice how in 1800, 81% of the world's population lived in extreme poverty, 81%, the majority of people living in extreme poverty.

And what happens if we look at that same graph, but we look at it in 1975? So about the time perhaps your parents were born or certainly 50 years ago.

If we look at the line for extreme poverty, by 1975, only 46% of the global population lived in extreme poverty.

So we'd seen a lot of progress, hadn't we, over 150 years, 175 years, sorry.

But some countries had benefited from economic growth more than others.

And if we look at the colours, again, within that distribution graph, we can see that Asia's population, in particular, is of interest because we can sort of see two humps within that distribution graph, can't we? And you can see how looking at those areas of kind of, if you like, rich and poor, why we might start to divide the world's population into rich and poor.

However, if we look at something like the population of Europe, mostly found in a single curve across that income distribution.

Fast forward to 2023, how does the population look if we organise it by income? Well, we can sort of see a single peak there, can't we? Certainly in terms of the Asian population has been transformed.

And overall, if we think about globally, by 2023, the proportion of the global population living on less than $2.

15 a day had reduced to 9.

7%, so less than 10% of the population today is living in extreme poverty.

So we've seen a real transformation there over time from when we started in 1800 to 1975 and then to 2023.

Have again a look at that graph.

Where would you say most people are living who live with extreme poverty today? Where are they located? And if you said, well, most people live in Africa and Asia, you'd be absolutely right.

So that's what we can see from the pink and the blue colours of that distribution graph.

True or false, then? Globally, 1 in 10 people live in extreme poverty.

Remember, I'm gonna want you to explain your answer in a second.

Have a think.

And if you said true, how do we know that? Well, 9.

7% of the global population live in extreme poverty in 2023.

As a ratio, this is approximately one person in 10.

So well done if you got that one right.

Another check for you here.

True or false? The share of people living in extreme poverty has reduced dramatically over the last 50 years.

Is that true or false? And how do you know? Well, that's also true.

How do we know that? Well, we have the answer here that 46% of the world's population lived in extreme poverty in 1975.

And that's changed, that's been dramatically transformed to 9.

7% in 2023.

So it's now about a fifth of what it was almost 50 years ago.

And we have this comment that in the last 20 years, the share of people living in extreme poverty has halved.

So that's a real good news story, isn't it, in terms of economic progress.

Oh, I have a different diagram for you here, and this is what we call a pictogram.

In this pictogram, each cube represents 100 million people in the world and they are ordered by income and coloured by regions.

So we can see where those 100 million people are located in Gapminder's four regions, then.

What do you notice about the geography of higher income levels? So what people in Gapminder have done is they've organised the world into four different levels of income or groups of income, level three and level four being the richer groups.

Well, Izzy says here that all four regions have at least 100 million people with a level three income, and Asia has the most people in those level three and level four income brackets.

The other thing she notices is that 800 million people live in the highest income level and a quarter of those are in Asia.

So perhaps some surprises there.

If we take that pictogram and fast forward to 2040, so we're projecting forwards based on what's happening with current economic trends, clearly in the future, the spatial pattern of income will change again.

And we can see that there are greater numbers of people living at the higher income levels and fewer people living in income level one, which is the level of extreme poverty.

We've also got some change in terms of the geography with people shifting up that income scale.

Now, Sam asks, "But how do countries develop over time?" So, how is this process of economic development taking place where countries are moving and regions are moving from the majority of people living in extreme poverty to the absolute minority? How does that happen? Rostow's modernization theory suggests that international trade is central to economic development.

He suggests that science and technology can increase the productivity of agriculture.

As a result of higher yields, bigger harvests in agriculture, this enables international trade, creating income to invest in new industries such as manufacturing industries.

And in turn, the export of goods produced by the manufacturing sector, those manufacturing industries, leads to increased incomes and a higher standard of living.

So I've really boiled Rostow's modernization theory down to three kind of stages demonstrating kind of linear progress, but perhaps we need to break that down a little bit more 'cause there's quite a lot to take in there, isn't there? So Rostow's theory is actually based around five stages, it's a five-stage model of economic development.

And if we have a look at the diagram that is linked to this model, we have time on the x-axis and on the y-axis we have income and investments.

So what we're seeing is increasing income and investments over time.

And Rostow sees countries going through five different stages with the rate of income and investment and economic growth increasing over time and then plateauing it from that diagram we can see.

So if we start with the traditional society, so Rostow, Walt Rostow, an economist, American economist, assumed that all countries start from a traditional society which is characterised as following.

So this society has low agricultural yields due to use of basic tools, a small amount of trade or bartering takes place, but this is because there's very little surplus to sell, so we're looking at subsistence farming.

Limited transport and communication links.

So even if you had surplus to sell, you can't really travel to trade that, and as a result, the economy is experiencing low growth.

So what Rostow has said, that's how societies begin and how do they get to this situation where we see the preconditions for takeoff.

So preconditions to takeoff is a stage a country might be in where we see mechanisation of agriculture and the growth of trade in summary.

What does that look like? Well, we have the use of new techniques in agriculture, so using machinery and potentially land use reform to make agriculture more efficient.

The production of cash crops to sell.

So countries deciding what they can produce well and what they can produce cheaply and then they can sell that abroad.

And then surplus income from the international trade that results is invested in industries and infrastructure, creating what Rostow saw as the preconditions for economic takeoff.

Now, the takeoff stage, and we can see here that the rate of economic growth has increased again at the takeoff stage, is characterised by rural to urban migration.

And of course, we saw that this in the UK and other European countries at the time in the industrial revolution where people moved from their farming communities and the countryside and moved to big cities to take up jobs in manufacturing industries, in factories.

We see the large-scale growth of manufacturing industries at this stage.

And more trade, more international trade, increases profits for those industries.

That profit is then invested in further development of industries, so the economy's not standing still, and more infrastructure to support industry and trade.

And then we have the drive to maturity.

This is the fourth stage of Rostow's model and it's characterised by sustained growth, meaning people are getting wealthier in the population.

Not only are they wealthier, but generally the standards of living are rising as the government can invest in healthcare and education services for its population.

And there's further investment in complex transport networks to handle increased exports.

So we've got a really mature economy at this point.

And then Rostow has his fifth stage, which is termed the age of mass consumption, with a focus on consumer goods and services.

Most people are employed in the service industry, so they've moved on from manufacturing industries to providing services such as finance and banking or insurance.

Manufacturing shifts to produce consumer goods.

And most peoples can afford luxuries, not just necessities, which is why it's termed this age of mass consumption.

Okay, so quite a lot to take in there about Rostow's theory about economic development.

I have a check for you here.

Which of the following are true of Rostow's theory about economic development? I'll let you read those through, discuss it with a partner, and then restart the video when you want to check your answer.

And if you said, well, investment in new industries is made possible by profits from trade, you'd be absolutely right.

But also notice C, this answer is right as well.

So rural to urban migration is a key part of the modernization process.

So well done if you've got both of those as being true of Rostow's theory.

So I mentioned that Walt Rostow was an American economist and his modernization theory was influential in the 1960s.

Any limitations perhaps of this model? Is this a model going to be applicable? Is it gonna be true for all countries and how they develop? What do you think? Well, Rostow's model is seen today as Eurocentric, it's based on industrial revolutions of Europe, European countries, and the USA, so it's less relevant for countries undergoing economic development today in the context of the globalised economy.

It's also seen as an element of western imperialism because it's promoting the idea that high mass consumption is the end goal for all countries, and as we know in terms of our environment, there are environmental limits on high mass consumption.

So, which of the following are seen as limitations of Rostow's modernization theory? Pause the video, discuss it with a friend, and then start the video again when you want to check your answer.

And if you said A is correct, a high standard of living depends on high consumption, you'd be absolutely right.

That is one limitation.

But there's also a second here, isn't there? A theory based on the historic experience of European nations alone.

So this is also a limitation of Rostow's modernization theory.

Well done If you got both of those right.

Okay, task for you here.

I'd like you to use some online resources to find out about how the share of people living at different income levels has changed over time.

As I mentioned earlier, gapminder.

org is a great place to start.

And if you see the screen grab I've provided of the website here, if you go and have a look at the data that they provide, you can use the play button for that graph of global income over time to actually see how that graph transforms over time.

You can also drag the timeline to view how the graph changes.

So two different ways of investigating how the regional and the global income has changed over time.

Remember that's a distribution graph.

Secondly, I'd like you to write a short paragraph summarising Rostow's modernization theory.

Hint, could you include the words, manufacturing, mechanisation, and trade or international trade? And thirdly, with a partner, make a list of how people benefit from the process of modernization, as suggested by Rostow.

We've been talking about a growing economy, but how do people benefit? So grab a pen, pause the video, and then restart it when you want to check your answers.

Okay, how did you get on? So task A, you had to do some investigating to think about how the share of people living at different income levels has changed over time.

You might have found that the share of people living in extreme poverty is about a fifth of what it was when your parents were born.

Also, it's more than halved over the last 20 years, a good news story.

And the division of the world into rich and poor, that two-hump distribution graph, disappeared by about 2010.

Did you find that? Also, 6.

54 million people worldwide live on income level six and seven, as described by that Gapminder website, but it's less than 1%, so we have got some really wealthy people in the world as well.

Secondly, you were asked to write a short paragraph summarising Rostow's modernization theory.

How did you get on? This is the answer we have.

Rostow's modernization theory outlines how a traditional agricultural economy transforms into a much larger, more complex economy that includes manufacturing and service industries.

Rostow suggests that this process involves a mechanisation of agriculture, international trade, and the reinvestment of profits from such trade to improve infrastructure and develop new industries.

Well done, that was a tricky task, wasn't it? Thirdly, I've asked you to, with a partner, make a list of how people benefit from the process of modernization.

We have a range of economic and social benefits here, including, well, people benefit from the creation of new jobs, they have a wage.

Of course, factory and service sector jobs are better paid than farming, so they can afford enough food, even luxuries.

Living conditions improve as the government can spend more on public services, links to that transport networks improve primarily to support trade, but this also benefits locals.

And there's easier access to public services for people living in urban areas in particular.

And there's a greater variety of goods and service available for consumers, particularly in that period of high mass consumption.

Okay, so we answered that first question, how do countries develop over time, looking at Rostow's theory.

Let's think about this question, how and why are some countries held back? In the late 1960s, German-American sociologist and historian Andre Gunder Frank suggested that unfair trade within the global economy held some countries back.

So here we have a diagram showing the globe where we have the periphery countries surrounding the core countries, and the core being the UK and the USA and European countries, and then the periphery being our developing countries.

His dependency theory disputed Rostow's theory that all countries can develop economically in a stage-by-stage process.

So he was saying that this is, you've suggested it's just a sequence, very straightforward sequence, but in reality that isn't how it works for all countries.

Frank suggested that core countries unfairly exploit those in the periphery, meaning their development is limited by what the powerful core does.

And we've got the ideas here that raw materials are exported from the periphery to the core and manufactured goods are sent from the core to the periphery.

Now, what's the problem with that? What's the problem with this kind of dominant movement of raw materials moving periphery to core and manufactured goods moving from the core to the periphery? Well, this was a direction of trade that was set up at a time of slavery and colonialism.

So countries in the periphery were historically exploited by slavery and colonialism, with those raw materials of the core countries the imperialists needed being exported back to the core to support the core's manufacturing industries.

And the issue is that the raw materials are of low value and the manufactured goods are of high value.

So instantly you can see that you've got value being added to raw materials as they're manufactured, as they're created into higher value goods.

And if those things are being bought by the periphery, then there's a sort of net movement of money and profit into the core.

We have the example here of India.

So in India was part of the British empire, and under British law, Indians were prohibited from making their own cloth.

Now, I'm sure you are familiar with Mahatma Gandhi, but Mahatma Gandhi was one of the leaders of the independence movement in India and started spinning thread as part of the independence movement in the 1920s, so protesting that law that stated that Indians couldn't make their own cloth, couldn't manufacture a higher-value product.

Frank suggested that this exploitative relationship that we saw under slavery and colonialism actually continues in a capitalist, free trade, profit-seeking world economy.

Developing countries, he suggests, are trapped in a dependent relationship by global trade rules that are shaped, that are influenced by the core.

And we've got the example here of Zambia.

So copper makes up more than 60% of Zambia's exports by value, and that's just true today, even though it was also true within colonial times.

Borrowing money when the global price of copper falls, because Zambia is so dependent on just very few exports and primarily copper, has forced Zambia into debt, and obviously that's going to harm the progress of Zambia's economy if it's paying a lot of money to service that debt.

True or false, then? Richer countries play a role in creating poverty.

Is that true or false? And think about what your explanation will be in a moment.

Well, that is true according to Frank.

How is that true? Well, we have the answer that Frank's dependency theory suggests that the core countries, the developed countries, exploit developing countries in the periphery.

As colonial powers, this was certainly true and international trade rules shaped by core countries restrict economic growth of developed countries today.

So the international trade rules set up by the core countries, the UK, the US, European nations, actually prevent peripheral countries exporting manufactured goods to those markets.

Frank suggested that developing countries should either isolate themselves from the global capitalist system to develop or undergo a socialist revolution to remove the corrupt ruling classes that collaborate with the core.

So this was his politics, he was a socialist.

Socialism is a political and economic system based on collective ownership, which is different to private ownership by individuals under capitalism.

So we've got politics coming in here as well.

Can you think of any limitations of Frank's dependency theory? What do you think? We had some limitations, didn't we, of Rostow's theory.

Any limitations of Frank's? Well, Frank did not anticipate the rapid economic growth of emerging economies.

So if you were telling me about Asian tigers or the BRICS, that's Brazil, Russia, India, China, and South Africa, those two groups of countries have seen rapid economic growth in living memory.

So, who are the Asian tigers? Well, we've got Hong Kong, Singapore, South Korea, and Taiwan.

And I mentioned the BRICS countries, Brazil, Russia, India, China, and South Africa.

You might have said the MINT countries as well, another group of rapidly growing, emerging economies.

In those countries because manufacturing companies in the core have sought to relocate their factories to reduce labour costs, we've seen skill and technology transfer occurring and a manufacturing sector producing export-led growth in those emerging economies.

And that was not anticipated by Frank's model around why some countries get stuck.

So which of the following is a limitation of Frank's dependency theory? Have a read through those and pause the video.

Restart it when you have an answer.

And if you said, well, A, emerging economies have experienced rapid economic growth despite being in the periphery, you are absolutely right.

Task for you here, then.

Firstly, I'd like you to locate these six statements about development theories in this Venn diagram.

So we have a Venn diagram here where some of these statements link to Rostow's theory that we heard about in the start of the lesson, and then some of these statements linked to Frank's theory, and then some of them perhaps relate to both.

And you can see I've located A in that Rostow's theory ring because A is a five-stage process of economic growth.

So you can see what you've got to do there.

How did you get on? So this is how those statements should be located.

So I'd located A for you.

Now, B is trade is key to economic development.

Rostow and Frank agree on that, so I've put that in the overlapping area.

C, trade rules shaped by core countries limit the growth of those in the periphery, well, that's linked to Frank's theory.

But D, rapid growth in manufacturing industries leads to economic takeoff, well, that's one of Rostow's key stages, isn't it? E, developing countries depend on developed countries to buy their exports.

And that's absolutely true for Frank's theory, his dependency theory.

And then F, a problem for developing countries that began with slavery and colonialism, relates to Frank's theory.

So the global system is a problem for developing countries, that's Frank's view.

I've got another task for you here.

Why do global inequalities in development still exist today? That's a question.

Now, Sam's had a go at answering this, but has made a few mistakes.

Can you spot the mistakes and correct them? Pause the video and have a go.

How did we get on? Here it turns out that Sam has made six mistakes and we've corrected all of them.

So let's read this through.

Dependency theory suggests that the world divides into the weaker periphery and the more powerful core.

We have those wrong, didn't we, in our original answer.

The periphery is exploited by the core.

In the past, this took the form of slavery and colonial rule, but today the global system of trade is to blame.

Countries in the periphery depend on selling cheap raw materials to the core, but must import more expensive manufactured goods.

Trade rules, not fools, are created by powerful developed countries, leaving the rest underdeveloped.

So if you spotted all six mistakes and have corrected them, well done to you.

In summary, what have we covered? Well, economic development has lifted millions of people out of extreme poverty, and we've seen that positive story of progress at the start of the lesson.

Rostow's modernization theory suggests that technology and international trade can transform traditional societies into wealthy economies focused on manufacture and service industries.

However, his theory is seen as limited, being Eurocentric.

Frank's dependency theory suggests that the developing countries in the periphery are being exploited by developed core countries within the global economy.

And this is a process that began with slavery and colonialism.

Unfair trade today limits development of the periphery, however, emerging economies have demonstrated that some economic progress is possible.

Well, we've covered quite a lot today.

And thank you for your attention, having a go at those practise tasks, some of 'em are quite tough.

I look forward to seeing you soon.