The document summarizes several classical theories of economic development: 1) Adam Smith, David Ricardo, and J.S. Mill believed that economic growth would slow or stop due to increasing population and limited resources. 2) Thomas Malthus argued that population growth alone does not lead to development and that capital accumulation is necessary for continued growth. 3) Walt Rostow proposed a model of economic growth occurring in five stages: traditional society, preconditions for take-off, take-off, drive to maturity, and high mass consumption. 4) John Stuart Mill viewed economic development as dependent on land, labor, and capital, and distinguished between productive and unproductive consumption.

1. Welcome to our
presentation

2. Topic: Classical Theories of
Development
i. Md. Nazmul Hasan - 15078
ii. Amanullah - 15080
iii. Md. Manazir Rahman - 15081
iv. Md. Belal Hossain - 15082
v. Md. Roknuzzaman - 15083
vi. Muhammad Ferdaus - 15084
vii. Md. Mahmudul Hasan - 15085
viii. Yousuf Ali- 15086
ix. Mustarin Salati - 15087
x. Rupa Das- 15088
Group Member

3. What`s classical development theory ?
• The basic theme of the classical model was the development of the
economy from a progressive state into a stationary state.
• The classical growth theory argues that economic growth will
decrease or end because of an increasing population and limited
resources. Classical growth theory economists believed that
temporary increases in real GDP per person would cause a population
explosion that would consequently decrease real GDP.
• The classical theory is basically a synthesis of the doctrines put
forward by Adam Smith, T. R. Malthus, David Ricardo, J. S Mill and
others.

4. Adam Smith`s development theory

6. Recardian Theory of Growth

8. Malthusian`s theory of development
• Malthus contends that the process of economic development is not automatic.
Rather conscious, deliberate efforts are needed to bring it about.
• For instance, Malthus explains that mere increase in population cannot by itself
lead to economic development unless there is increase in effective demand.
• He regards capital as indispensable to development. According to him, “no
permanent and continued increase of wealth can take place without a continued
increase of capital.”
• “The development of the industrial sector of underdeveloped countries is
limited by the poverty of the agricultural sector.” This is due to the fact that the
lack of purchasing power in the rural masses reduces effective demand in the
economy and retards its growth.

9. Rostow`s theory of Development
• Rostow's Stages of Economic Growth model is one of the major
historical models of economic growth. It was published by American
economist Walt Whitman Rostow in 1960. The model postulates that
economic growth occurs in five basic stages, of varying length:
• Traditional society
• Transitional society
• Take-off
• Drive to technological maturity
• High mass consumption

11. Mill’s Theory of Development
• Economic development as a function of land,
labour and capital.
• Productive consumption vs unproductive
consumption.
•Malthusian theory of production.

12. • Key points of Mills' theory
Control of population growth
Wage fund
Role of capital accumulation
Rate of profit
Role of state
Stationary state.