The Importance and Limitations of Dependency Theory, as well as a Critical Appraisal
Dependency Theory attempts to analyze international politics by focusing on the unequal relationship that exists between nation-states, specifically between Developed Countries (Centre) and Underdeveloped Countries (Periphery). Dependency theory is an approach to understanding economic underdevelopment that emphasizes the putative constraints imposed by the global political and economic order on developing countries. The concept of dependency theory was first introduced in the late 1950s by the Argentine economist and statesman Ral Prebisch, and it gained attention in the 1960s and 1970s.
Depending on the definition of dependence theory, underdevelopment is caused mostly by a country’s position in the world economy that is considered peripheral. Typically, developing countries compete on the world market by offering low-wage labor and low-cost raw commodities. These resources are sold to mature economies that have the capability of converting them into completed items, such as automobiles. Underdeveloped countries are forced to purchase finished goods at exorbitant costs, depleting the cash that could otherwise be used to expand their own manufacturing capability. As a result, the world economy is trapped in a vicious cycle that perpetuates the split between a wealthy core and an impoverished periphery. Rather than arguing that some level of development is possible within the current system, moderate dependency theorists such as the Brazilian sociologist Fernando Henrique Cardoso (who served as President of Brazil from 1995 to 2003) argued that the only way out of dependency is the establishment of a noncapitalist (socialist) national economy.
When Dependency Theory was first proposed, it was seen as a counter-narrative to the conceptions of modernisation and progress that had been developed and promoted by Western and Marxist thinkers. Naturally, it includes a strong critique of both the structuralist and the Marxist schools of thought.
This theory begins with a study of the colonial impact on indigenous socio-economic and political structures, moves on to analyze the characteristics of a new socio-economic structure, and finally attempts to trace the evolution of the new socio-economic structure in relation to both internal changes and developments in the global capitalist system.
Underdevelopment as a Result of Dependence:
It examines the internal dynamics of poor countries and establishes a connection between their underdevelopment and their places in the world economic system. Also considered is the relationship between the internal and external structures.
It provides an explanation for the underdevelopment of Third World countries in terms of the socio-economic-politico-cultural dynamics that connect these countries to the developed countries. As a result, the underdeveloped countries are regarded as the peripheries, while the developed countries are regarded as the centers. It is believed that the nature of social phenomena in the periphery can only be understood and analyzed in relation to the world capitalist system, which is dominated by the developed centers.
Dependency Theory is based on the premise that the nature of social phenomena in Third World nations is determined by the trend of underdevelopment that defines these countries and that is the outcome of the spread of World Capitalism. Furthermore, their underdevelopment is directly and inextricably linked to their reliance on outside Helpance. The truth is that virtually everyone who believes in dependence theory is in agreement that underdevelopment is driven by external dependence, particularly on capitalist countries.
Dependency as a Result of the Expansion of World Capitalism: A Case Study
The Dependency Theory takes a macro-historical and structural approach to understanding the world. A rejection of the Continuum as well as Marxist interpretations of growth and underdevelopment is involved in this process. In this view, underdevelopment is caused by capitalist expansion that is accompanied by unequal exchanges, in which the Centre/Core/Metropolis exploits the resources and labor of the periphery to its own gain. The periphery is characterized by a state of dependency and a lack of progress in comparison to the center.
‘Dependency’ refers to a situation in which the development and expansion of one country’s economy is dependent on the development and expansion of another country’s economy to which the former is exposed. As a result, when some countries (the dominant ones) are able to expand and become self-sufficient, while others (the dependent ones) are merely reflecting that expansion, which can have either a positive or a negative impact on their immediate development, the relationship of interdependence between two or more economies, and between these and world trade, takes on the form of dependence.” —Dos Santos et al.
The Dependency Theory is a theory of how things depend on one another.
As a result, dependence can be defined as the relationship that exists between the dependents and the developed countries. Underdeveloped countries’ potential to develop is constrained by this circumstance. The expansion of capitalism places a limit on its potential. Its traditional form was imperialism or colonialism, however its present form is Neo-colonialism, which is defined as a state of dependency between the undeveloped periphery (the new states) and the developed core (the old states) (the former imperialist- colonialists).
The majority of dependence theorists employ the center-periphery paradigm for evaluating the structure and scope of international relations, as well as the nature of underdevelopment that characterizes the political systems of the poor countries, among other things.
Andre Gunder Frank, Wallerstein, Dos Santos, Osvaldo Sunkel, Celso Furtado, Rodolfo Stavenhagen, Euzo Falleto, and Frantz Fanon are some of the most prominent proponents of Dependency Theory today. The underdevelopment of Third World countries, or “the wretched of the Earth,” as Frantz Fanon refers to them, is closely tied to their neocolonial existence, which is defined as their reliance on the industrialized countries for foreign Helpance.
Andre Gunder Frank and Wallerstein made a significant contribution to the development of Dependency Theory in the early twentieth century. Both of them were adamant in their belief that the underdevelopment of the Third World (Periphery) was a result of the development and expansion of a developed economy, on which the latter was reliant.
They argue that the growth of the periphery was impossible under the conditions of the world capitalism system, which remained pro-centre (pro-developed countries) to the utter detriment of the periphery. The undeveloped countries have long been considered satellites of the developed countries with large metropolitan areas. The import-substitution industrialization thesis, as espoused by development theorists, has failed to gain traction in developing nations, particularly in the Third World.
The opposite has happened: their economies have stagnated and are becoming more and more reliant on the economy of the rich countries. According to dependency theorists, the only option for undeveloped countries to progress toward development was to topple the present structure.
In order to achieve this goal, some dependency theorists advocated for a socialist revolution; however, others advocated for liberal reforms that included maintaining a balance in trade, increasing bargaining power through regional cooperation, and assimilation of new technologies through macroeconomic adjustments.
An Assessment of Dependency Theory from a Critical Perspective:
The Dependency Theory provides a very intriguing and in-depth analysis of politics in impoverished nations, as well as the nature and breadth of ties between these countries and the industrialized ones, among other things. The center-periphery paradigm is employed by the majority of dependence theorists for this purpose.
In their words, the underdeveloped world is in a state of dependency, which has resulted as a result of the rise of global capitalism. The vast majority of them believe that underdevelopment is the only option available in the context of a capitalist world economy. As a result, many of them believe that socialism, whether achieved through a socialist revolution or other liberal reformist measures/movements, is the most effective treatment for reliance and underdevelopment.
The significance of Dependency Theory is as follows:
All of the criticisms leveled at the dependency theory must not cause us to lose sight of the theory’s significance. Besides bringing to light the flaws in development and underdevelopment theory, it should also be commended for placing a strong emphasis on the examination of both historical processes and socio-economic, political, and cultural elements that influence development or underdevelopment.
It has done a good job of pointing out the flaws and biases of the continuum model of development, particularly as it has been put up by structural functionalists, and it should be commended for doing so. The Dependency Theory has, without a doubt, fallen short of its goal of providing an impartial analysis of the nature and breadth of underdevelopment, as well as feasible solutions for overcoming or overthrowing the condition of dependency.
But it should be mentioned that it has been successful in recognizing and explaining the symptoms and negative consequences of underdevelopment, as well as their causes. Dependence is described in terms of a set of descriptive properties, as well as the relationships that link the dependencies.
ADVERTISEMENTS:
No one can deny the presence of dependency within the context of the current and ever-increasing interconnectedness that characterizes contemporary world affairs. As a result, no one can or should dismiss the proposals advanced by dependency theorists for minimizing the negative consequences of Third World dependence on the developed world. With justification, this article emphasizes the urgent necessity to abolish the negative consequences (Neo-Colonialism and Hegemony) of the increasing world capitalist system.
Listed here are 10 limitations of Dependency Theory:
Even the Marxists, the revolutionary socialists, and the communists reject the majority of the theories of the dependency theorists, particularly their conception of capitalism as a social structure characterized by a certain type of trade relationship rather than as a mode of production.
The following are some of the most significant shortcomings of dependency theory in international politics:
1. There is a lack of consensus among Dependency Theorists:
First, opponents assert that dependency theorists are divided on the precise nature of dependence and underdevelopment, as well as on the mechanisms involved in dependency relationships and the potential solutions for them. Dependency Theory is not a theory, but rather a collection of numerous ideas that are related to one another.
(2) Radical and socialist ideologies are promoted:
The dependence theorists do not form a cohesive collection of thinkers in their field. A.G. Frank and Furtado are socialist nationalists, while Dos Santos and Furtado are radicals, and still others are revolutionary socialists (such as Furtado and Sunkel) or socialists (such as Furtado) (Wallerstein). While some of them advocate for a complete transformation, whether through a revolution or other radical reformist means, others advocate for structural reforms and new forms of cooperation between the centers and the peripheries as means of bringing about an end to the state of dependency that exists today.
Dependency does not have a clearly defined meaning:
They fail to define and explain dependence and underdevelopment in a clear, categorical manner, as do the dependency theorists. They do not provide a criterion that may be used to distinguish between dependent and non-dependent countries, and this is unacceptable.
4. Adopting a Negative Approach:
For example, according to S.K. Sahu, “the authors of the dependence theory have been more concerned with fighting the desirability of the capitalist-system on the periphery than they have been with attacking the “dependent” status.” When it comes to dependency theory, it focuses more on addressing the flaws of World Capitalism and less on the ways and means of removing dependency in the developing world.
5. Fail to take into account the various variables that contribute to underdevelopment:
The essence of underdevelopment in various Third World countries is revealed when we examine the data from country to country and continent to continent, respectively. The nature and scope of dependency would have been uniform if it had arisen solely as a result of the expansion of the World Capitalist System throughout time. It is important to note that the nature of underdevelopment in Latin America differs from that of underdevelopment in Asia and Africa.
6. The concept of Unequal Exchange was not defined correctly:
It is argued by opponents that the idea of ‘unequal exchange,’ which is employed by dependence theorists, fails to provide an objective analysis of the factors contributing to the underdevelopment of Third World countries. Furthermore, there is no widely accepted principle for determining the form and breadth of ‘unequal exchange,’ which is believed to be the source of the underdeveloped’s reliance on the developed. Nor can there be such a principle.
7. Limitations of the idea of Surplus Value include the following:
When it comes to defining underdevelopment in terms of capitalistic exploitation, the dependence theory makes the mistake of relying on Marx’s concept of surplus value. It is not possible to accept the concept of Surplus Value as a valid principle because of the inherent limits of the term itself.
Several developing countries have made some poor decisions and implemented policies that have contributed to their underdevelopment.
The underdevelopment of the Third World has also been attributed in great part to its incomplete industrialization and the failure of the underdeveloped countries to create and implement industrial plans that are well thought out and coordinated with one another. The underdeveloped countries, for their part, have failed to properly exploit their own resources, both in terms of raw materials and human capital.
This, combined with the fact that some countries have been successful to a significant extent in achieving rapid industrial-technological development while others have failed to do so, tends to demonstrate that it is the under-developed countries themselves, rather than only the capitalist countries, who are to blame for their dependence.
9. The Center-Periphery Model Has Its Limitations:
When it comes to the world, the split between the center and the periphery, metropolis and satellite, developed and developing countries is fairly arbitrary and even misleading, as has been done by dependence theorists. It is extremely difficult to understand that all undeveloped countries, including local behemoths such as India, Brazil, Mexico, South Africa, and others, are equally reliant on the developed. However, this is the reality.
Failure of Socialist Solutions and Systems (number ten):
As the socialist development system in the former Soviet Union and the Eastern European states has failed, it serves as a demonstration that dependency cannot be removed by a socialist revolution or socialism.
It reflects a rejection of all theories which hold the world capitalist system responsible for the emergence of the evil of dependence of the Third World on the developed countries in the contemporary years of international relations.
In fact, even the Marxists, the revolutionary socialists, and the communists reject the majority of the ideas of the dependency theorists, particularly their conceptualisation of capitalism as a social system characterized by a specific type of exchange relationship rather than as a mode of production or a mode of production and an exchange relationship.
