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This textbook is specifically designed for students of economics and the social sciences who are taking a first course in economic development with a background knowledge of micro and macro economics. It is written in a way which should also make it accessible to policy makers and all those concerned with the process of economic development in the Third World. In this extensively revised and updated edition there is extended discussion on the measurement of poverty, the characteristics of underdevelopment, the role of the State in the development process and the financial aspects of development. This text is intended for advanced undergraduate courses in growth and development as part of economics and other related degree programmes, and should also be useful for economic development courses as part of social science degree courses.