Stages of economic development

This piece is written in response to a shout-box query on factor driven economy.

The earliest stage in economic development is recognized as a factor driven economy. In this the economic growth is recognized as primarily the result of mobilization of primary factors of production viz., land, primary commodities and unskilled labour. Contrast this with economies which are investment-driven. In the latter, economic growth is largely seen as the result of harnessing of global technologies to local production. This stage transforms itself into innovation-driven economy when there occurs an improvement in technologies that support economic growth. Largely this is how economic development / growth is explained.

Have more time or want more detail? Follow this piece. This is a ten page piece from the who's who of economics. Michael Porter, Jeffrey Sachs & John Mcarthur. Once in a while you should read such pieces. They will do you a lot of good and enhance the 'extensive' reading background that you get to possess over a long time.