What is the general gist of the dependency theory?
The idea that resources flow from the periphery to the core of wealthier states, improving the QofL for the rich, but keeping the poor in a constant state of underdevelopment.
Who proposed the dependency theory?
Andre Frank
Give benefits of the theory for MEDCs.
- They recieve cheap, manufactured goods from LEDCs and keep high-value goods for themselves
- MEDCS control debt, high-skill migration (brain drain) and innovation
Give the benefits of the theory for LEDCs.
- FDI by TNC’s provides employment, income and skills
- Helps some economies progress through Rowstow’s Model e.g. Japan
What are the drawbacks of the theory?
- Developed countries hinder developing countries by controlling terms of trade
- Requires action - some countries cannot get out of debt to invest in themselves to develop
What organisation helped Singapore’s recovery post-WW2?
IMF (USA)
How did former British colonial rule lead to India’s history of underdevelopment?
- Loss of money (war)
- Forced India to import goods from UK and not buy their own goods (economy collapse and dependency on Britain)
- British controlled government
- Tax mismanagement
- Loss of culture, language, racism, tradition etc…
What case studies shows that dependency theory doesn’t always keep the LEDCs underdeveloped?
Japan, BRICS
How has Japan opposed the theory?
Investment in Japan’s economy post war by the IMF/World Bank led to it’s rapid recovery, political stability, rising living standards, universal suffrage and the breaking up of powerful interest groups. Now, it is a very powerful global economy.
Who are the ‘Asian Tigers?’
Highly developed economies of Hong Kong, Singapore, South Korea and Taiwan – they were the first newly industrialised countries
How can countries escape the cycle and develop?
Countries should adopt the ‘virtuous cycle of development’ (keep their surplus resources and invest in their processing + manufacturing industries to add value to their goods)
Outline the 1st step of the dependency cycle?
- Primary products sold to developed world e.g. cotton, corn
Outline the 2nd step of the dependency cycle?
- Developed world adds value to these materials (secondary products) and sell them
What is the problem with this dependency cycle?
No profit is made for producer countries (who are still developing, dependent on primary sector) and so they are trapped in a cycle of poverty.
