Question

The concept of “balanced growth” talks about:
• [(1)] Taking advantage of backward and forward linkages in the production process
• [(2)] Synchronized application of capital to a wide range of industries
• [(3)] Low level equilibrium trap
• [(4)] Rural-urban migration

• A. 1
• B. 2
• C. 3
• D. 4

Hint:

Remember the difference:
• Balanced Growth (Ragnar Nurkse): Simultaneous investment in many industries.
• Unbalanced Growth (Albert Hirschman): Investment in selected key sectors to create backward and forward linkages.

Answer 1

The Correct Option is B

Concept: The Balanced Growth Theory was propounded by Ragnar Nurkse. According to this theory, underdeveloped economies can overcome the problem of a small market by making simultaneous investments in a wide range of complementary industries. The theory emphasizes that investment should be made in many sectors at the same time so that the increase in income generated in one industry creates demand for the products of other industries, resulting in self-sustaining economic growth.

Step 1: Understand the concept of Balanced Growth. Balanced growth refers to the \[ \boxed{\text{Synchronized application of capital to a wide range of industries.}} \] This ensures that industries support each other through increased production and demand.

Step 2: Examine the given options.
• [(1)] Taking advantage of backward and forward linkages is related to the Unbalanced Growth Theory proposed by Albert Hirschman.
• [(2)] Synchronized application of capital to a wide range of industries correctly describes the Balanced Growth Theory.
• [(3)] Low level equilibrium trap is associated with Richard Nelson's theory and is not the concept of balanced growth.
• [(4)] Rural-urban migration is explained by migration theories such as the Harris-Todaro Model, not balanced growth. Therefore, \[ \boxed{\text{Balanced Growth means synchronized investment in a wide range of industries.}} \] Hence, the correct answer is \[ \boxed{(B)\;2} \]