Development Theory - Dependency Theory

Dependency Theory

Dependency theory is essentially a follow up to structuralist thinking, and shares many of its core ideas. Whereas structuralists did not consider that development would be possible at all unless a strategy of delinking and rigorous ISI was pursued, dependency thinking could allow development with external links with the developed parts of the globe. However, this kind of development is considered to be "dependent development", i.e., it does not have an internal domestic dynamic in the developing country and thus remains highly vulnerable to the economic vagaries of the world market. Dependency thinking starts from the notion that resources flow from the ‘periphery’ of poor and underdeveloped states to a ‘core’ of wealthy countries, which leads to accumulation of wealth in the rich states at the expense of the poor states. Contrary to modernization theory, dependency theory states that not all societies progress through similar stages of development. Primitive states have unique features, structures and institutions of their own and are the weaker with regard to the world market economy, while the developed nations have never been in this follower position in the past. Dependency theorists argue that underdeveloped countries remain economically vulnerable unless they reduce their connectedness to the world market.

Dependency theory states that poor nations provide natural resources and cheap labor for developed nations, without which the developed nations could not have the standard of living which they enjoy. Also, developed nations will try to maintain this situation and try to counter attempts by developing nations to reduce the influence of developed nations. This means that poverty of developing nations is not the result of the disintegration of these countries in the world system, but because of the way in which they are integrated into this system.

In addition to its structuralist roots, dependency theory has much overlap with Neo-Marxism and World Systems Theory, which is also reflected in the work of Immanuel Wallerstein, a famous dependency theorist. Wallerstein rejects the notion of a Third World, claiming that there is only one world which is connected by economic relations (World Systems Theory). He argues that this system inherently leads to a division of the world in core, semi-periphery and periphery. One of the results of expansion of the world-system is the commodification of things, like natural resources, labor and human relationships.