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Center/Core States

( "dominant," "metropolitan")

Periphery

("dependent," "satellite")

Policy Implications

  • Industrialized countries are not a model of ideal development
  • Path dependency - the decisions of developing countries are limited by the decisions made in the past by developed countries
  • Trickle-down economics are not effective and do not account for wealth distribution
  • GDP is a problematic measure of development
  • Self-reliance over integration into global marketplace
  • Latin America had the highest levels of economic growth during the WW and Great Depression (did better when they lost their export market)

The Dependency School

Raul Prebisch

Neo-Marxism

  • More radical approach, inspired by revolutions in China and Cuba
  • Differs from traditional Marxism
  • Look at imperialism from the periphery's point of view
  • Want socialist revolution as opposed to two-stage revolution
  • Revolution should be led by the peasants, not the industrial proletariat
  • Provided many key concepts to the dependency movement

Andre Gunder Frank

  • Argentine economist, president of the central bank of Argentina, and director of the ECLA
  • Strategy for development:
  • Substitute imports for domestically produced products
  • Support domestic production from competition through tariffs
  • Use the income from exporting raw materials to purchase capital goods
  • Government needs to be an active participant in industrialization
  • German-American economic historian
  • Brought the ideas of dependency back to the U.S.
  • Critique of modernization
  • Assumes internal problems are the reason Third World countries are not developed
  • Ignores historical context
  • Assumes Western world is

model for development

  • Ignores colonialism
  • Frank offers an "external" view
  • "The development of

underdevelopment"

  • Monthly Review

Theotonio Dos Santos

  • Brazillian economist
  • Developed the common definition of dependence
  • The relationship between two or more countries "assumes the form of dependence when some countries (the dominant ones) can expand and can be self-starting, while other countries (the dependent ones) can do this only as a reflection of that expansion."

Immanuel Wallerstein

  • Distinguished 3 historical forms:
  • Colonial dependence
  • Financial-industrial

dependence

  • Technological-industrial

dependence

  • Subsidiary companies

  • Singer-Prebisch hypothesis
  • Failure of the ECLA program
  • Internal markets of the poorer countries could not support the economies of scale that idustrialized countries used to

keep prices low

  • Lack of political will to stop exporting primary products
  • Import dependency shifted from industrialized goods to capital goods
  • Dependency school wanted more radical solution

  • American sociologist
  • Influenced by Dependency Theory and Marxism
  • Developed the World-System Theory

Central propositions

  • Modernization assumes that societies progress through steps of development; dependecy theory says that England and the US were never underdeveloped
  • Underdevelopment is not the same as undevelopment
  • Historical context for why people are poor
  • Preference of alternative resource use
  • Need to consider national interests that include the interests of the poor

Semi-periphery

Background and Historical Context

References

First arose in Latin America in the early 1960s in response to:

  • Failure of the Development Project
  • W.E. Rostow's 1960 list of countries on the verge of becoming rich
  • Israel, Japan, Argentina, Brazil, India, Mexico, Venezuela, and Russia
  • By 1970, only Japan. And by the 80s, most Asian and African countries were worse off than before
  • American modernization school
  • "Voices from the periphery" - Blomstrom and Hetne, 1984
  • Failure of the U.N. Economic Commission for Latin America (ECLA)
  • Raul Prebisch, 1950
  • Critique of the international division of labor
  • Protectionism and import substitution
  • These approaches were unable to explain the realities of economic stagnation, political repression, and the widening income gap.

McMichael, P. (2012). Development and social

change. Thousand Oaks, CA: Sage.

Packenham, R.A. (1992). The dependency

movement: Scholarship and politics in development studies. Cambridge, MA: Harvard University Press.

Peet, R., & Hartwick, E. (2009). Theories of

development. New York: The Guilford Press.

So, A.Y. (1990). Social change and development:

Modernization, dependency, and world-system theories. Thousand Oaks, CA: Sage.

  • Dependency theory fails to specify specific mechanisms
  • Arghiri Emmanuel
  • Samir Amin
  • Fernando Cardoso

Taking a Closer Look

"Why are some places poor? "

  • At the time dependency theory was being developed, looked to China and the Soviet Union as world powers that were not integrated into the economy
  • Cutting yourself off from the world economy did not work
  • Russia until the 1960s
  • China until the 1980s
  • Myanmar - One of the larget income gaps in the world, 150 out of 187 countries on the HDI
  • North Korea - 156 on HDI, GDP per capita less than $2,000
  • Internal markets may work for countries with 50-100 million people but not for small countries

Criticisms of Dependency

Dependency Theory

  • Background and historical context
  • The Dependency School
  • Key theorists
  • Central tenets
  • Policy implications
  • Responses and criticisms

Outline

  • The idea that resources flow from from a "periphery" of poor and underdeveloped states to a "core" of wealthy states, enriching the latter at the expense of the former.
  • 2 strains of Dependency Theory
  • Dependency Theory
  • World System Theory
  • Added the terminology of "core" and "periphery"
  • Examined the global division of labor
  • Recognition that the global economy is a "World System," and has been since the 1500s

Dependency Theory

Mary Margaret Saulters

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