Theories of economic development

Development theory asks why some economies transform and others stagnate. The classical writers saw growth driven by capital accumulation and division of labour, but limited by land (Ricardo) or by capitalism's own contradictions (Marx). Later theories offered strategies: Rostow's stages, balanced growth (advance everywhere at once) versus unbalanced growth (deliberately create bottlenecks to pull investment along), and the big push (a coordinated large investment to escape a poverty trap). Worked example: the big push logic — a single shoe factory fails because workers have no income to buy shoes, but building many industries together creates the incomes that buy one another's output.