Big Push

Published Apr 6, 2024

Definition of Big Push

The Big Push model is a concept in development economics which suggests that a certain minimum amount of investment is necessary to overcome the barriers to economic development in poor countries. This model argues that in order for a developing economy to achieve a self-sustaining growth, considerable investments in various sectors—including infrastructure, education, and technology—must occur simultaneously. The theory emphasizes that piecemeal approaches to investment and development may not lead to significant improvements due to the interdependencies of modern economies.

Example

Consider a hypothetical developing country, Country X. In Country X, the agriculture sector employs the majority of the workforce, but productivity is low due to outdated farming methods and insufficient infrastructure, such as roads and irrigation systems. Furthermore, the lack of access to quality education and healthcare limits the workforce’s efficiency and innovation potential.

In line with the Big Push theory, the government decides to implement a comprehensive development program. It invests simultaneously in infrastructure projects, such as building roads and improving irrigation, introduces new technologies to farmers, invests in education by building schools and training teachers, and improves healthcare services. These concurrent investments allow for improvements in agricultural productivity, which in turn increase incomes. The higher incomes generate increased demand for goods and services, stimulating other sectors of the economy and leading to overall economic growth.

Why the Big Push Matters

The Big Push model is significant because it provides a framework for understanding why some countries remain in poverty traps and what can be done to escape them. It suggests that marginal investments in isolated areas may not be sufficient to stimulate sustainable development. Instead, a coordinated approach that covers multiple sectors can create synergies, making the investments more effective and kick-starting the economy towards growth.

Furthermore, the theory highlights the role of government and external aids in catalyzing development. In many cases, the private sector may be unable or unwilling to make the large-scale investments needed due to high risks and uncertain returns. Thus, the Big Push model underscores the necessity for public investment or international assistance to mobilize the resources needed for comprehensive development initiatives.

Frequently Asked Questions (FAQ)

Is the Big Push theory applicable in all developing countries?

While the Big Push theory provides valuable insights into the dynamics of economic development, its applicability can vary depending on the country’s specific context, including its economic structure, political environment, and social conditions. Some countries may benefit more from targeted interventions rather than large-scale investments across various sectors simultaneously.

What are the criticisms of the Big Push model?

Critics of the Big Push model argue that it may lead to inefficient allocation of resources, as it requires massive public investments that might not always be used effectively. There’s also a risk of fostering dependency on government support, potentially stifling private sector initiative and innovation. Moreover, the model assumes a level of coordination and efficiency in government actions that may not be realistic in many developing countries due to corruption, capacity constraints, and other governance issues.

How do countries finance a Big Push?

Financing a Big Push can be challenging due to the significant resources required. Countries may rely on a mix of domestic resources, international aid, development loans, and foreign direct investments. Efficient and transparent use of these resources is crucial to ensure that the investments lead to sustainable development outcomes without creating unsustainable debt burdens.