Dependency Theory

Definition

Dependency theory is an approach to understanding global inequality and development that posits that the economic development of countries is heavily influenced by their relationships with more developed nations, creating a dependency that hinders growth. This theory suggests that resources flow from peripheral (less developed) countries to core (developed) countries, perpetuating a cycle of underdevelopment and inequality.

5 Must Know Facts For Your Next Test

1. Dependency theory emerged in the late 1950s and 1960s as a critique of modernization theory, arguing that modernization cannot be fully understood without considering historical colonial relationships.
2. The theory highlights that international trade practices often favor developed nations, leading to the exploitation of resources in developing countries without equitable benefits.
3. Key proponents of dependency theory include economists like Andre Gunder Frank and sociologist Immanuel Wallerstein, who emphasized the structural inequalities in the global economic system.
4. Dependency theorists argue for policy changes that focus on self-reliance and regional integration among developing countries as a means to break the cycle of dependency.
5. Critics of dependency theory contend that it can oversimplify complex relationships and ignore internal factors within developing countries that also contribute to underdevelopment.

Review Questions

• How does dependency theory challenge the assumptions made by modernization theory regarding development?
  • Dependency theory challenges modernization theory by asserting that development is not a linear process where all nations progress through the same stages. Instead, it emphasizes the historical and ongoing exploitation of peripheral nations by core nations, suggesting that external factors significantly influence development outcomes. While modernization theory focuses on internal characteristics of countries, dependency theory points to global economic structures that perpetuate inequality and hinder the growth of less developed nations.
• Discuss the implications of dependency theory for contemporary development practices and policies in developing countries.
  • Dependency theory has profound implications for contemporary development practices, urging developing countries to prioritize self-sufficiency and regional cooperation. By understanding their historical context within the global economy, these countries can seek alternative development pathways that minimize reliance on foreign investment and aid. This approach advocates for policies aimed at local empowerment and sustainable practices that directly benefit their economies instead of enriching developed nations through exploitative relationships.
• Evaluate the effectiveness of dependency theory in explaining current global inequalities and propose potential solutions based on its principles.
  • Dependency theory effectively explains current global inequalities by highlighting how historical colonial exploitation has shaped contemporary economic structures. However, its effectiveness can be enhanced by integrating insights from other theories, such as World Systems Theory, to provide a more nuanced analysis. Potential solutions based on dependency principles include promoting fair trade practices, enhancing local production capabilities, and fostering stronger economic ties among developing nations to reduce dependency on core countries. These measures can help create a more equitable global economic system.

Related terms

Core-Periphery Model: A model that describes the global economy as divided into core regions, which are economically dominant, and peripheral regions, which are economically dependent and often exploited.

Neocolonialism: A form of indirect control where developed countries exert influence over developing nations through economic and political means, rather than direct military or political domination.

World Systems Theory: An analytical framework that categorizes countries into a global system of interconnected economic and political relationships, highlighting how these relationships impact development.