SCHOOL OF POST_ GRADUATE STUDIES DEPARTMENT OF POLITICAL SCIENCES NASARWA STATE UNIVERSITY, KEFFI NASARAWA STATE A RESEARCH PAPER ON POLITICAL ECONOMY OF AFRICA COURSE CODE: TOPIC: WHAT ARE THE MAJOR DIFFERENCES BETWEEN DEPENDENCY THEORY AND MARXIST THEORY OF ECONOMIC DEVELOPMENT BY USMAN BABA ABDULMALIK NSU/SS/M.SC/000/11/12 2012 Abstract This paper intends to investigate the prime differences between the dependency theory and the Marxist theory of economic development. To clarify the basic perspective of the both the dependency and Marxist theory, the paper also tried to bring to lime light the brief history of dependency theory. This researcher work would also serve as source for the department in particular and the university in general. Conversely, the paper decisively presented that the prime alteration between the dependency and Marxist theory is that classic analysis does not in dependency theory while marxist theory of economic development used classis analysis as the major viewpoint. Introduction The Dependency Theory: - Is a neo-Marxist theory that was developed to explain the world capitalist system. Previously, the Marxists and Neo-Marxists had tended to analyze western capitalism in isolation of the rest of the world as if western societies were a closed system that developed independent of outside influence. The dependency theory arose, therefore, as a rejection of such a limited form of analysis. They contended that it is only through the analysis of the capitalist system within the world economic system that the features of capitalism, including its unusual economic expansion, development and underdevelopment of societies can be clearly understood. The dependency theory is a theory which emphasizes the fact that global society has developed in an uneven manner polarizing into the core and the dependent nations. Furthermore, that development in the core nations (USA, Europe and Japan etc.) was a consequence of the underdevelopment of Third World countries (in Africa, Asia and South America) that have been made dependent. Dependency in the wise usually involves the production and sale of primary goods (cash crops) and other raw materials by the Third World countries to the Western nations and the purchase of secondary goods (manufactured goods) from the west. The prices of both goods determined by the Western nations in their own interest. BRIEF HISTORY Dependency theory originated with two papers published in 1949- one by Hans Singer, one by Raul Prebisch- in which the authors observe that the terms of trade for underdeveloped countries had deteriorated over time: the underdeveloped countries were able to purchase fewer and fewer manufactured goods from the developed countries in exchange for a given quality of their raw materials exports. This idea is known as Singer-Prebisch thesis. Prebisch, an Argentine economist at the United Nations Commission for Latin America (UNCLA), went on to conclude that the underdeveloped nations must employ some degree of protectionism in trade if they were to enter a self-sustaining development path. He argued that Import-substitution industrialization (ISI), not a trade and export orientation, was the best strategy for developed countries. The theory was developed from a Marxian perspective by Paul A. Baran in 1957with the publication of his The Political Economy of Growth. Dependency theory shares many points with earlier, Marxist, theories of imperialism Rosa Luxemburg and V.I. Lenin, and has attracted continued interest from Marxists. Rudimentary Principles of The Dependency Theory The premises of dependency theory are: Poor nations provide natural resources, cheap labor, a destination for obsolete technology, and markets for developed nations, without which the latter could not have the standard of living they enjoy. Wealthy nations actively perpetuate a state of dependency by various means. This influence may be multifaceted, involving economics, media control, politics, banking and finance, education, culture and all aspects of human resources development (including recruitment and training of workers). Wealthy nations actively counter attempts by dependent nations to resist their influences by means of economics saction and or the use of military force. Dependency theory states that the poverty of the countries in the periphery is not because they are not integrated into the world system, or not ‘fully’ integrated as is often argued by free market economists, but because of how they are integrated into the system, it is classified under the sociological theories of mass communication. Subject Matter Precursors of the dependency school premise their belief on the fact that colonialism and subsequently neo-colonialism is the cause of Africa and Third world underdevelopment. This ideology emerged in the 1950s to counter the views of classical Marxists like Rosa Luxemborg, Lenin and Bill Warren and others who upheld the view of marx and Engel as enshrined in the communist Manifesto that colonialism would draw even the most barbaric nations into civilization. Classical Marxists shared optimism regarding the mission of colonialism in the occupied territories not undermining the possibility of continued existence of some form of pre-capitalist social relations within the territories. The dependency school does not inject any form of technological industrialization, rather in the words of Rodeny: capitalism in the form of colonialism, failed to perform in Africa the tasks it had performed in Europe in changing social relations and liberating the forces of production. (Rodney, 1974: 215-216). Standard dependency theory differs from Marxism, in arguing against internationalism and any hope of progress in less developed nations towards industrialization and a liberating revolution. The otonio dos Santos described a ‘new dependency’, which focused on both the internal and external relations of less-developed countries of the periphery, derived from a Marxian analysis. Former Brazilian president Fernando Henrique Cardos inscribed extensively on dependency theory, arguing that it was an approach to studying the economic disparities between the center and periphery. The American sociologist Immanuel Wallerstein refined the Marxist aspect of the theory, and called it the “world system.” One of the precursors of dependency, Andre Frank (2005), spotted that underdevelopment results from unequal exchange that allowed less developed countries only a lop-sided development progression creating an unhealthy balance of trade which constituted the reason for disparity between the rich and poor population. The poor nations provide natural resources, cheap yet exist only as a destination for obsolete technology, and markets to the wealthy nations who designed the rules of international trade and commerce and end up reaping the benefits accruable to both worlds as evident in the high standard of living they enjoy. phenomena—including social relations, political and legal system, morality and ideology- arise (or at the least by which they are greatly influenced). For Marxist the social relations form the superstructure, for which the economic system forms the base. These inefficiencies manifest themselves as social contradictions in the form of class struggle. Marxism is based on a materialist understanding of societal development, taking at its starting point the necessary economic activities required by human society to provide for its material needs. The form of economic organization, or mode of production, is understood to be the basis from which the majority of other social capitalism arises due to intensifying contradictions between highly- productive mechanized and socialized production performed by the proletariat and private ownership and private appropriation of the surplus product in the form of surplus value (profit) by a small minority of private owners called the bourgeoisie. As the contradiction becomes apparent to the proletariat, social unrest between the two antagonistic classes intensifies, culminating in a social revolution the eventual long term outcome of this revolution would be the establishment of socialism- as economic system based on cooperative ownership of the means of production, distribution based on one’s contribution, and production organized directly for use. Karl Marx hypothesized that, as the productive forces and technology continued to advance, socialism would eventually give way to a communist stage of social development. Communism would be a classless, stateless, moneyless society based on common ownership and the principle of “From each according to his ability, to each according to his needs”. Marxism has developed into different branches and schools of thought. A great emphasis on certain aspect of Classical Marxism while de-emphasizing or rejecting other aspects of Marxism, sometime combining Marxist analysis with non- Marxism concepts. External versus Internal Limits to Development For Baran and other Marxists the origins of the center periphery relation were strictly technological and determined by the international division of labor. The center produce manufactured goods for itself and the periphery, while the latter produced commodities mainly for the center, as well as maintaining a relatively large subsistence sector. Marxist dependency has explained the lack of dynamism in the underdeveloped world as the result of its particular insertion in the world economy. A large surplus led to more accumulation of capital and a higher growth rate. Similarly, for Marxists it was in the uses of the surplus that the differences between developed and underdeveloped regions were most evident. In the most backward countries, where the process of industrialization did not take hold and agriculture was still dominant, underdevelopment resulted from the patterns of land tenure that led to excessive concentration of ownership. The predominance of the large estates in plantation societies implied that a great part of the surplus remained in the hands of the landowners, who emulated the consumption patterns of developed countries. Excessive and superfluous consumption of luxuries then reduced the potential for investment and capital accumulation. In refuting the Marxist emphasis on the relevance of external factors, however, structuralist version of dependency went to the other extreme and claimed that internal forces were the almost exclusive determinant of development. Dependency theorists rejected the Marxist view, arguing that underdeveloped countries are not merely primitive versions of developed countries, but has unique features and structures of their own; and, importantly, are in the situation of being the weaker members in a world market economy. Dependency Perception Hence, dependency theory drew heavily from the perception that the world would eventually subsume to marx’s predictions and become socialist. Several African leaders of the independence period of the 1960’s drank deeply from the wells of the socialist ideology from Nkrumah to Nyerere. The then wide ranging belief which held sway ushered in the assumption that the historical process of the spread of capitalism resulted in the underdevelopment of the periphery Third World. External factors like colonialism, the capitalist world economy and world market integration were considered responsible for the lag in the periphery’s development. Elucidation of Marxist Perception or Perspective Marx postulated four mode of production which corresponds to stages of social development: First there was the primitive communal society or Asiatic society. Here because the technology was simple both production and consumption were communal. But with the invention of of tool emerged private- ownership of those tools. Slave society emerged from the communal society which was negated. The next stage was the slave society. At this stage the slave and the tool are property of the slave owner. This was a society of two classes; the slave masters and their slaves. Interest in private ownership of land created problem and the solution was found in the development of feudal lords to mediate the contradictions of the slave society. Feudalism arose when land was owned by hereditary nobility. The landless now providing labor or borrowing land and paying tributes or ground rent to the nobility. The discovery of money and the introductory of steam engine made it possible for the feudal society to be negated. The owners of capital negated feudalism. The capitalist society emerged during industrial Revolution to over feudalism. In England, it was a gradual transformation but in France, it was sudden through a revolution. Marxist Viewpoint Thus from Marxist viewpoint, if we want to analyze the history of any society or the social change in that society, we must look at the mode of production of material life which includes the forces of production and the relations of production earlier explained. It is the dialectics of the mode of production of material life that determines social change or the history of a people. This is what Marx’s critics called ‘economic determinism’. Summary Summarily, the core of dependency theorists argument is premised on the note that the wealthy nations of the world need a periphery group of poorer state in order to remain wealthy and that the poverty of the countries in the periphery is not because they are not integrated into the system, but because of how they are disadvantageously integrated into the system. The theory however began to wane in popularity in the 1990s, with the rising success of countries such as India and Thailand and some other Third world countries excluding those of sub-Sahara Africa. Conclusion The paper asserted the major differences between the dependency theory and the Marxist theory of economic development. In the propelling assertion the paper concluded that the main modification between the dependency proponents and the Marxist theorists. Is that the dependency theory does not make classic analysis while in the Marxist theory the emphasis is on classic analysis. References Books Igwe, S.C. (2010). How Africa Underdeveloped Africa. Professional Printer & Publishers, Port Harcourt. Baker, R., (2005) capitalism’s Achilles Heel. John Wiley & Son: UK. Ekelund, Robert B., Jr. & Hebert, Robert F. (1997). A History of Economic theory and method (4th Ed.). Long Grove Illinois: Waveland press. Rodney, w. (1974). How Europe Underdeveloped Africa. Howard University press. Marx, K., cited in Lancaster L. (1959). Masters of political thought (Vol.3), London: London George Harrap and co. ltd.
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