Basic Human Needs versus Economic Growth Approach for Coping with Urban—Rural Imbalances: An Evaluation Based on Relative Welfare

Abstract

Increasing attention is being paid to the ‘basic human needs' approach for reducing imbalances within a developing country, urban—rural imbalances being important among them. However, as investment for meeting basic human needs is not directly productive, the future growth of the economy would have to be sacrificed if this approach is taken. In this paper the development implications of two approaches, the economic growth and the basic human needs approaches, are projected through a simulation model, and they are evaluated relative to each other. It is shown that, even if the evaluation is based on the criterion of the relative position of the rural population to the urban population, low-income countries would be better off with the economic growth approach after about ten years. For middle- and high-income countries, the basic human needs approach deserves serious consideration.