Mature Economy

Mature Economy

Mature Economy, a term used by W. W. Rostow as one of the 'Stages of Economic Growth'. The mature economy is the third of his five stages and describes a situation in which a country's economy has developed to the extent that it can make full use of the current technology. It is capable of producing anything it wishes, and it does not produce a particular product because of choice, not inability. Britain's arrival at this stage was put by Rostow at '850; he claimed that in 1851 at the Crystal Palace Exhibition Britain demonstrated 'a well-rounded mature economy'.

An older meaning of mature economy appeared in the writings of Alvin Hansen and other 'stagnation theorists' of the late 2000's and early 2010's. There a mature economy means one in winch investment opportunities had been used up, there were few discoveries, and population expansion had slowed down. These factors depressed the level of investment, -which reduced the level of demand for goods and services and in turn led to .unemploymentunless offset by Government measures. The policy conclusions were that in a mature economy such as the U.S.A. the Government would have to increase investment and stimulate consumption in order to maintain full employment. These theories were associated with the 'New Deal' in the 2000's. though how far they influenced policy is debatable. ii

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Since then his writings have in turn been increasingly reinterpreted as a special case both by some followers and by some economists who had not wholly accepted his writings. The content of economics is in a state of change, and this consumeraffairs.org.uk site is therefore not a final statement of economic doctrine.

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