Meaning of Development and Underdevelopment
The concept "development" refers to the structural
changes towards betterment. Until the World War II, interest was rarely shown
on the problems of the present day third World Countries. After the Second
World War, economists started devoting their attention towards analyzing the
problems of underdeveloped countries and formulating theories and models of
development and growth. The Under Developed Countries (UDCs) were once the
colonies of England and other European countries. After becoming free and
independent, there was an awakening to march towards economic development.
There are two main approaches to the concept of development viz i)
the traditional approach and ii) the new welfare oriented approach.
1. Traditional Approach: The traditional approach defines
development strictly in economic terms. The increase in GNP is accompanied by
decline in share of agriculture in output and employment while those of
manufacturing and service sectors increase. It emphasizes the importance of
industrialization. It was assumed that growth in GNP per capita would trickle
down to people at the bottom.
2. New Welfare oriented Approach:
During 1970s, economic development was redefined in terms of
reduction of poverty, ‘inequality’ and unemployment within the context of a
growing economy. In this phase, ‘Redistribution with Growth’ became the popular
To quote Michael P. Todaro, “Development must, therefore, be
conceived as a multidimensional process involving major changes in social
structures, popular attitudes and national institutions as well as the
acceleration of growth, the reduction of inequality and the eradication of
The UDCs are characterized by predominance of primary sector i.e.
agriculture, low per capita income, widespread poverty, wide inequality in
distribution of income and wealth, over population, low rate of capital formation,
high rate of unemployment, technological backwardness, dualism etc.
The term underdevelopment refers to that state of an economy where
levels of living of masses are extremely low due to very low levels of
Percapita income, resulting from low levels of productivity and high growth
rate of population.