Having critically examined the comparative analysis of balanced and unbalanced growth strategies, a logical question arises: which of these two strategies provide greater stimulus of economic growth?

The unbiased and impartial opinion is that there is no need to the debate on the controversy.

It is strictly based on empirical evidence and political motivation. While Paul Streeten contends that it is possible to reformulate the choice between balanced and unbalanced growth.

But Ashok Mathur argues that, “balanced and unbalanced growth need not be mutually conflicting and an optimum strategy of development should combine some elements of balance as well as unbalance.”


Both the theories are based on the theory of Big Push which advocates investment to break the vicious circle of poverty. The balanced growth aims at the development of all sectors simultaneously but unbalanced growth recommends that the investment should be made only in leading sectors of the economy.

Underdeveloped countries have insufficient resources in men, material and money for simultaneous investment in number of complementary industries. The investment made in selected sectors leads to new investment opportunities. The aim is to keep alive rather than to eliminate the disequilibrium by maintaining tensions and disproportions.

Balanced growth aims at harmony, consistency and equilibrium whereas unbalanced growth suggests the creation of disharmony, inconsistency and disequilibrium. The implementation of balanced growth requires huge amount of capital.

On the other hand, unbalanced growth requires less amount of capital, making investment in only leading sectors. Balanced growth is long term strategy because the development of all the sectors of economy is possible only in long run period. But the unbalanced growth is a short term strategy as the development of few leading sectors is possible in short span of period.


The doctrine of balanced growth and unbalanced growth have two common problems on relating to role of state and the role of supply limitations and supply inelasticity’s. The private enterprise is only incapable of taking investment decisions in underdeveloped countries. Therefore, balanced growth presupposes planning. In unbalanced growth strategy, the states play a pioneer role in encouraging SOC investments, there by creating disequilibrium.

If the development starts via Investment in DPA, political pressures force the state to undertake investment in SOC. The theory of balanced growth is mainly concerned with the lack of demand and neglects the role of supply limitations.

This is not true as underdeveloped country lacks in supply of capital, skills, infrastructures and other resources which are- inelastic in supply. Similarly, unbalanced growth doctrine also neglects the role of supply limitations and supply in elasticity’s. Under such situations, a judicious compromise has to be made between the benefits from balanced growth and unbalanced growth.

There is no second opinion that the developing countries are wedded to democracy who should try to control the twin evils of inflation and adverse balance of payments during the course of pursuing any strategy of economic development. The need of the hour is that it should be done to make the doctrine effective as a vehicle of economic development with added strength and vigour.


In this context, Prof. Meier has rightly observed that, “From the discussion we may also now recognize that the phrases balanced growth and unbalanced growth initially caught on too readily, and that each approach has been overdrawn. After much reconsideration, each approach has become so highly qualified that the controversy is essentially barren.

Instead of seeking to generalize either approach we should more appropriately look to the conditions under which each can claim some validity. It may be concluded that while a newly developing country should aim at balance in an investment criterion, this objective will be attained only by initially following, in most case, a policy of unbalanced investment.”