Describe dependency theory and delineate its salient features

Q: Describe dependency theory and delineate its salient features

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Dependency theory is a sociological and economic framework that critiques traditional development models and explores the structural inequalities inherent in the global economic system. Developed primarily in the mid-20th century, dependency theory provides an alternative perspective on development and underdevelopment, emphasizing the unequal relationships between developed and developing countries. The theory argues that economic disparities between nations are not merely a result of internal factors within developing countries but are deeply rooted in their historical and structural relationships with more developed nations.

Salient Features of Dependency Theory

  1. Core-Periphery Model:
  • Concept: Dependency theory divides the world into core and peripheral regions. Core regions are highly industrialized, economically advanced, and politically dominant, while peripheral regions are less developed, dependent on core countries, and often exploited for their resources.
  • Core Regions: These are characterized by high levels of industrialization, technological advancement, and economic power. They control global markets and financial institutions.
  • Peripheral Regions: These regions are typically less developed and rely heavily on exporting raw materials and labor to core countries. They often experience economic exploitation and underdevelopment.
  1. Economic Exploitation and Unequal Exchange:
  • Concept: Dependency theory posits that peripheral countries are economically exploited by core countries through mechanisms such as unequal trade relations and resource extraction. Peripheral nations often provide raw materials and labor at low costs while importing finished goods from core nations at high prices.
  • Unequal Exchange: This term refers to the imbalance in trade relationships, where the terms of trade favor core countries. Peripheral countries often face unfavorable conditions in global markets, which perpetuate their economic dependency.
  1. Historical and Structural Relationships:
  • Colonial Legacy: Dependency theory highlights the historical context of colonialism, which established and reinforced the economic dependencies of peripheral countries. Colonial powers extracted resources, disrupted local economies, and created conditions that continue to affect development.
  • Structural Factors: The theory emphasizes that the global economic system is structured in a way that perpetuates inequalities. The relationships between core and peripheral countries are deeply embedded in global economic and political institutions.
  1. Internal and External Factors:
  • Internal Factors: While acknowledging the impact of internal factors such as governance and policy decisions, dependency theory argues that these factors cannot be fully understood without considering the external influences of core countries.
  • External Factors: The theory stresses that external factors, such as international trade policies, foreign investment, and global financial systems, play a significant role in shaping the development outcomes of peripheral countries.
  1. Development as a Process of Unequal Integration:
  • Concept: According to dependency theory, development in peripheral countries is often hindered by their integration into the global economy in a subordinate position. Rather than benefiting from global economic growth, peripheral countries may find themselves trapped in cycles of dependency and underdevelopment.
  • Development Impact: The theory argues that the development of core countries is often linked to the underdevelopment of peripheral countries. The growth of core economies may come at the expense of peripheral economies, which remain economically disadvantaged.
  1. Resistance and Alternative Paths:
  • Concept: Dependency theory suggests that to break free from dependency, peripheral countries must pursue alternative development strategies. This may involve reducing reliance on core countries, fostering domestic industries, and implementing policies that promote self-sufficiency and equitable development.
  • Strategies: Possible strategies include import substitution industrialization (ISI), regional integration, and efforts to diversify economies away from dependency on core countries.
  1. Critique of Modernization Theory:
  • Concept: Dependency theory critiques modernization theory, which posits that all countries follow a similar path of development from traditional to modern stages. Dependency theorists argue that this perspective overlooks the structural inequalities and power dynamics that shape global development.
  • Criticism: They assert that modernization theory fails to address how the global economic system perpetuates disparities between developed and developing countries, and how these disparities impact the development prospects of peripheral nations.

Conclusion

Dependency theory offers a critical perspective on global development by highlighting the structural inequalities and power imbalances between core and peripheral countries. Its salient features include the core-periphery model, the concept of economic exploitation and unequal exchange, the emphasis on historical and structural factors, and the critique of modernization theory. By focusing on the external influences and historical legacies that shape development outcomes, dependency theory provides insights into the challenges faced by developing countries and advocates for alternative development strategies to address global inequalities.

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