the social and political order. The nouveaux pauvresresent their poverty,
a particularly significant fact given that economic growth can significantly
increase the number of losers. Rapid growth concentrates material gains in
relatively few hands as prices increase faster than wages and technological
change replaces people with machines. At such times, and especially in the
early stages of industrialization, there are unlikely to be welfare arrange-
ments to compensate for economic hardship. There will also be those who,
though making some absolute gains from economic growth, find that their
relative position has deteriorated, a further source of dissatisfaction and of
contradiction between the structure of economic and political power. Fur-
thermore, levels of consumption can decline with rapid economic growth.
Standards of living may have to be reduced to produce the required rate of sav-
ings. Consequently ‘it is economic stability – the absence of rapid economic
growth or rapid economic decline – that should be regarded as conducive to
social and political tranquillity’ (Olson, 1963, p. 550).
This convincing a priorireasoning has been queried in view of the
growth rates in many Western countries since 1945 which have been higher
than at any previous period in their histories without causing political insta-
bility (Castles, 1974). The fact that there are examples of countries which
have experienced high rates of economic growth and political stability, in
Europe and Scandinavia, suggests that there are other influences being felt
in developing countries.
Crude models of ‘traditional’ and ‘modern’ society must also be avoided.
Ake points out that role confusion and disorientation can stimulate group
identity and associational sentiments rather than cause hostility and alien-
ation. Industrialization can be integrative, creating new foundations for social
linkages, such as class. Social differentiation can eliminate sources of conflict
and reduce tension. New forms of political participation can be supportive
rather than destabilizing. The fact that economic modernization can generate
instability does not mean that it necessarily will (Ake, 1974, pp. 576–84).
In developing countries it would seem that there are circumstances
which, when combined with rapid growth, produce political instability. It
may also be that political stability makes it possible for a country to enjoy a
high rate of economic growth. If political stability and high rates of growth
go hand in hand in advanced industrialized countries, it does not necessar-
ily follow that this would be the case in poor agrarian societies. Booth’s
research on Central America found that rapid growth in agriculture together
with industrialization reduced the relative and absolute living standards of
the working class, who then revolted against their governments. Only when,
as in Costa Rica and Honduras, governments responded with policies to
228 Understanding Third World Politics