Relationship between development and underdevelopment

Definitions of development & under-development | Revision World

relationship between development and underdevelopment

The economic underdevelopment of developing countries. . discussing the relationship between developed and underdeveloped countries and how the. polis, the internal contradictions between the forces and relations of production have . In the network linkages of development and underdevelopment the state . Thus the gap between developed and developing countries of Asia and Africa and the connection between the satellite relationship and underdevelopment.

Essay on Economic Development and Underdevelopment

The reason is that, Japan, unlike most of the Asian countries, was never a capitalist satellite. Satellite Relationship and Underdevelopment: Since the 19th century, the growth of its major cities has been satellite development — largely dependent on outside capitalist powers, specially Britain and the USA.

relationship between development and underdevelopment

Consequently some regions in interior Brazil have become satellites of these two countries and, through them, of the Western capitalist countries. Frank suggests that satellite countries experience their greatest economic development when they are least dependent on the world capitalist system.

relationship between development and underdevelopment

Thus, Argentina, Brazil, Mexico and Chile grew most rapidly during World War Ithe Great Depression and World War IIwhen their trade and financial relations with the major capitalist countries were the weakest. They were the greatest exporters of primary products, and the biggest sources of capital for developed countries and were abandoned by them when—for one reason or another — business fell off.

relationship between development and underdevelopment

Frank gives examples of undivided Bengal, the one-time sugar-exporting West Indies, and Northeastern Brazil, the defunct mining areas of Brazil, highland Peru and Bolivia; and the former silver regions of Mexico in this context.

According to Frank the following economic activities have contributed to underdevelopment, not development: Forming an unskilled labour force to work in factories and mines and on plantations. Workers migrating from villages to foreign-dominated urban complexes.

Opening the economy to trade with, and investment from, developed countries. According to dependency theorists, the causes of underdevelopment are not to be found in national systems alone but must be sought in the pattern of economic relations between hegemonic, or dominant, powers and their client states.

Secondly, both within and among states, the unfettered forces of the market-place tend to exacerbate rather than to mitigate existing inequalities. The dominant foreign power benefits at the expense of its client states and the clientele class benefits at the expense of other classes. To dependency theorists, foreign investment and aid did not promote development in the Third World, but were used as a means of exploitation, that is, of extracting capital from client states.

Dependency based on the international division of labour led to unequal exchange relation between the rich and the poor. The terms of trade of LDCs deteriorated because LDCs had to pay high prices for developmental imports and received less prices for their exports. So their balance of trade position deteriorated.

According to Frank, a Third-World economy can developed only by withdrawing from the world capitalist system. However, this implies a large reduction in trade, aid, investment and technology from the developed capitalist countries.

relationship between development and underdevelopment

In the post Second World War — 45 period, developing countries grew much faster than they did earlier. Yet, the post War growth of such countries has not been no faster than that of developed countries. Whether this means convergence or divergence depends on time, scope and definitions. Despite the earlier anticipation of some development economists, however, an entirely new sub-discipline of development economies has not arisen.

It is believed that there are mutual gains from trade to be realised by both rich and poor countries alike if they liberalise their foreign trade regimes. The promotion of a liberal international economic order should yield a positive sum game — not a North-South confrontation. But the orthodox liberal ideology is not true in the real sense.

The rich, capitalist developed nations gain from trade liberalisation at the expense of poor countries. In recent decades, parallel to the rise of the new development economies and the revision of development strategies, there have been a number of dissenters who propound a radical critique of mainstream development thinking.

Raul Prebisch and Hans Singer are the main critics of this ideology. The found that after opening up trade the terms of trade of the developing nations have fallen. They export manufactured goods and increase their relative terms of trade.

Prebisch-Singer have found out that if the income of a particular individual increases, then he prefers manufactured goods than primary products.

Industrialisation based on import substitution is, therefore, advocated to protect the one-sided gains from trade.

Essay on Economic Development and Underdevelopment

Tariff protection and quotas on industrial imports are believed capable of forestalling a further deteriorations in the terms of trade, avoiding BOP fluctuates which check growth when export prices fall and promoting the absorption of the labour surplus in industry. In their advocacy of industrialisation protection, and planning, Myrdal, Prebisch, Singer influenced the early tenets of the new development economies.

This is rare, however, and dependency is enforced far more by the wealthy nations setting the rules of international trade and commerce. Dependency theory first emerged in the s, advocated by Raul Prebisch whose research found that the wealth of poor nations tended to decrease when the wealth of rich nations increased.

The theory quickly divided into diverse schools. Former Brazilian President Fernando Henrique Cardoso wrote extensively on dependency theory while in political exile.

Modernization Theory / Development and Underdevelopment in Bangladesh

The American sociologist Immanuel Wallerstein refined the Marxist aspect of the theory, and called it the " world system. The semi-periphery is composed of countries such as Brazil and South Africa that can't simply be categorized as part of the core or the periphery i. World systems theory also states that the dynamic of surplus extraction that occurs between nations also occurs within them, between their elite and poor classes.

According to this structure, which includes a core, a periphery, and a semi-periphery, not every nation can develop simultaneously which directly challenges the linear model of modernization which suggests that all countries are on the trajectory of development.

WST instead argues that development and underdevelopment are created simultaneously. According to Brazilian social scientist, Theotonio Dos Santos, dependence means a situation in which certain countries economies' are conditioned by the development and expansion of another to which the former is subject.