Dependency

Dependency theory was developed in the 1950s to 70s, mostly by scholars from Latin America trying to explain why Latin America had failed to develop in the 130 years since independence.

It starts from the Marxist-Leninist assumption that capitalism is fundamentally exploitative. It diverges from the orthodox Marxist-Leninist assumption that colonialism spread industrialization to colonized countries. Dependency theorists argued that relations of difference and exploitation between core and peripheral countries have becomeentrenched at a global scale. Peripheral countries would always remain dependent on the capital, markets (for raw materials) and manufactures of core countries, and unable to create their own self-sustaining economies. This relationships must not be understood as a "feudal" periphery that had still failed to develop or catch up. Rather, the periphery are permanent and necessary part of global capitalism. Some basic ideas:

• Development and underdevelopment can not be understood by looking at societies in isolation, but at how they are inserted into global economic relations.
• Colonialism brought few, if any, benefits. It certainly did not bring the means of producing self-sustaining industrial development. Rather it created infrastructures and industries for the extraction of raw materials to core countries. In other words, open economies are detrimental to the development of peripheral nations.
• Relations of imperialism and dependency developed in collaboration with local elites. They can't be understood only interms of direct capital and colonization by the core.
• Foreign capital uses the military and political influence of core countries to support local elites, who operate extractive industries, and suppress potential workers' movements, keep wages low, and develop infrastructures oriented towards extraction rather than national development.
• It is more difficult to catch up, because core nations have leaped so far ahead that it is nearly impossible for underdeveloped countries to obtain the education, infrastructure and capital necessary to create competitive industries. Cheap raw materials, and the necessity of foreign currency to buy advanced technology, patents and intellectual property rights all exacerbate the cycle of dependence.
• Isolation from global capitalist forces is the best chance for development.
• Economic forces are the primary causal mechanism in history. Social and cultural changes are shaped by economic relations.

World-Systems Theory, developed primarily by Immanuel Wallerstein, is a variation on dependency theory. Rather than just focusing on particular core-periphery relationships, it looks at the economy as a global whole--a global division of labor created by the spread of the European capitalist world system. Some of its new emphases include:

• Single Capitalist World-system started in Europe and expanded to incoporate all of the world by the late nineteenth century. Even socialist nations are part of it.(true socialism is only possible at a global scale). Tribute-based world systems dominated much of the world before the emergence of the capitalist system.
• The world system experiences cycles of growth and contraction. Expansive cycles (Kondratieff A phase) are associated with the rise of a single hegemonic power. Contraction (B phase) is associated with a fragmentation of power and restructuring (including increased colonization).
• States are a necessary element of the world economy. They help concentrate power, create a competitive system, and create an ideology that promises the possiblity of development to all states. Class, ethnicity and family are also important organizational institutions--each obscuring and undermining the workings of the others.
• Semi-Periphery. These are countries that manage to escape dependent peripheral conditions. Some semi-peripheries evolve into core states, while others engage in industries and services no longer based in the core. They tend to be protectionist, while core and peripheral states engage in freer trade. They provide ideological justification of the beneficient effect of capitalism.
• Forms of labor are increasingly coercive the farther away from the core. The amount of coercion rises and falls along with cycles of expansion and contraction--more people being coerced in periods of expansion.
• Forms of Knowledge that divide the world into politics, society, economy, or such as racism, culture and "civilization," are all specific to the capitalist world system.
• Resistance is futile. Even resistance movements tend to appropriate the basic ideals of the world system, such as need for more equality, more freedom, ethnic recognition, more national self-determination, economic development, etc.
• Internal contradictions of the capitalist world system will eventually lead to its self destruction and the rise of global socialism.

It also develops the idea of a semi-periphery, of countries going through the process of development or which have created so-called socialist economies that have industry but no mass consumer society

Back to Schedule