Singer’s Critique of Balanced Growth Doctrine

Prof. Hans Singer and Alberto Kirsch n eminent  American economists, have   criticized Ur C doctrine of balanced growth. They contend that what is  needed is  to lanced growth but a strategy of judiciously planned unbalanced growth According to Singer balanced grew Sh cannot  solve the problem of tile under countries  nor do they have sufficient re 0 IT e 0 thieve balanced  growth. Singer maintain  growth  doctrine might be better express send f allows As  hundred  lowers aye grow re single flower would wither away for la of nourishment  But  where are  he resources to grew kindred flowers Singer agrees that the slogan  top inking   piecemeal and start thinking big is a . sound ad ice for underdeveloped  countries it he also feels that there are  several areas of doubt about the balanced growth theory in its Eurasian fond.  First. if the balanced growth doctrine is   interpreted to advise the under developed countries to  embark on large and varied  packages of industrial investment  with no attention to agricultural productivity it  an lead to trouble. At the initial stages of development,as the income grows with we industrial  investment and employment. the relatively greater  demand would be  rested for food and other agricultural goods. In order to sustain industrial investment. the agricultural productivity would have to be greatly raised. Tills. the   if push in industry must be accompanied by a big push in agriculture as well if the  country  is not to run short of foodstuffs and agricultural raw materials during the   transition to an industrial

But when we start talking about varied investment  packages for industry and   major additional blocks of investment in agriculture at the same time  we run into   imperious doubts about the capacity of under-  developed countries to follow the   balanced  growth path. Singer quotes Marcus Fleming. “Whereas the balanced   growth doctrine assumes that the relationship  between industries  is for the most   art  complementary. the  limitation of factor supply  assures that the relationship is  or the most  part competitive Where from money will Singer adds The overcome  for balanced growth. sources required for  carrying out the policy of balanced   growth are of such an order of magnitude that a country disposing of such   resources would in fact not be underdeveloped  Investment may be of whatever  type it necessarily  induces some additional investment and some other productive   activities According to Singer. the expansion of social capital overheads and the   improvement of production techniques cannot take place simultaneously  because  he under developed countries  have only limited capabilities of making use of their resources In the under developed countries. not only arc the resources and the   capabilities to bring about balanced growth lacking but. according to Churchman,  balanced growth lacking but. according to  Irishman balanced growth is not even  desirable. His  view is that if mic growth is to be accelerated it  will have to be  rough about by unbalanced growth.  If we promote growth by creating imbalances  n the  economy the growth will be accelerated because it will produce such   incentives and pressures which will  encourage development in the private sector. The doctrine is premature rather than wrong  Singer concludes. It is   applicable to a subsequent stage of self sustained growth rather than to tile breaking  f  a deadlock. For launching growth it may well be a better development strategy to  concentrate available resources on types of investment which help to make the  economic system more elastic more capable of expansion under the stimulus of  expanded markets and expanding demand. He instances investment in social  overhead capital and removal of special bottlenecks as examples of such strategic   investment.  The fundamental trouble with the balanced growth doctrine. Singer   further concludes, is its failure  to come to grips with the true problem of   underdeveloped countries, the shortage of resources

Think Big is a sound advice to under developed  countries but Act light is unwise counsel if it spurs them to bite more than they can possibly chow.  Moreover the   balanced growth doctrine assumes that an under-developed country starts from a   scratch. In reality every under developed country starts from  a position that reflects previous investment and precarious development. Thus at any point of time there arc lightly desirable investment programmers which arc  not in themselves balanced investment packages but  which represent unbalanced investment to complement existing imbalance