suza dds 01 development theories of development show

THE STATE UNIVERSITY OF ZANZIBAR(SUZA)

DDS 0111 DEVELOPMENT STUDIES PERSPECTIVES

THEORIES OF DEVELOPMENT

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What is development

• Different people have different understanding of the term. However they all end comparing space and time because development is a relative term.

• Is a process of economic and social transformation which is based on complex cultural and environmental factors and their interactions.

• Development is a process of improved standard of living.

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WHAT IS DEVELOPMENT?

• Development was a process in which ‘societies’ defined as nation states pass through similar stages of development on the road to an end state.

• Development is a multi-dimensional and multi-sectoral process, involving social, economic and political change aimed at improving people’s lives.

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Human Development

• It is the process of enlarging people choices it has about four aspect:-

• For people to lead a long and a healthy life

• For people to acquire knowledge

• For people to have access to resources needed for a descent standard of living.

• People enjoyed self respect and guaranteed human right.

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Under Development.

• US-President Truman’s ‘bold new program’ announced on January 20, 1949, defined Africa, Asia and Latin America as ‘underdeveloped areas’ in need of ‘development’

• Underdevelopment is the absence of modern economic growth that characterizes Third world countries by comparison with the developed nations of the West.

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DEVELOPMENT THEORIES

Modernization

Dependencia

World system theory

• Alternative development

• Human development

• Anti development

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Modernisation Theory

• Has cultural, political and economic component

• Different authors stress different aspects of the argument

• After WWII, the poverty and backwardness of some of the world countries became extremely conspicuous

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Modernisation theorists aimed to:

a) explain why poorer countries failed to evolve into modern societies

b) Reduce the spread of communism by presenting capitalist values as the solution to poverty

Modernisation theory has become increasingly

influential, especially since post collapse of USSR

Modernization

• Modernization is an encompassing process of massive social changes, that once set in motion tend to penetrate all domain of social life, from economic activities to social life, to political institutions, in a self reinforcing process.

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Five stages:

• WALT WHITMAN ROSTOW(1916–2003)

1) traditional society

2) preconditions for change

3) take-off

4) drive to maturity

5) mass consumption

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Traditional Societies• Extended kinship

• Little spatial and social mobility

• Primary economic activities

• Tendency towards autarchy of social units

• Undifferentiated political structures with traditional elites

• Hierarchical source of authority

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Traditional Societies• These are societies

which have pre-scientific understandings of gadgets

• Believe that gods or spirits facilitate the procurement of goods, rather than man and his own ingenuity.

• The norms of economic growth are completely absent from these societies.

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Preconditions for Take-off

• The preconditions to take-off are, to Rostow, that the society begins committing itself to secular education, that it enables a degree of capital mobilization, especially through the establishment of banks and currency, that an entrepreneurial class form, and that the secular concept of manufacturing develops, with only a few sectors developing at this point. This leads to a take off in ten to fifty years.

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The Take-off

• Transition from traditional to modern economy

• The economic transitions are accompanied by the evolution of new political and social institutions that support industrialization.

• The growth is self-sustaining as investment leads to increasing incomes in turn generating more savings to finance further investment.

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The Take-off

• Industrialization increases with workers switching from the agricultural sector to the manufacturing sector.

• Growth is concentrated in a few regions of the country and within one or two manufacturing industries.

• The level of investment reaches over 10% of GNP. People save money.

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The Drive to Maturity

• The drive to maturity refers to the need for the economy itself to diversify. The sectors of the economy which lead initially begin to level off, while other sectors begin to take off. This diversity leads to greatly reduced rates of poverty and rising standards of living, as the society no longer needs to sacrifice its comfort in order to strengthen certain sectors.

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The Drive to Maturity

• The economy is diversifying into new areas. Technological innovation is providing a diverse range of investment opportunities.

• The economy is producing a wide range of goods and services and there is less reliance on imports.

• Urbanization increases.

• Technology is used more widely.

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Age of High Mass Consumption• The age of high mass

consumption refers to the period of contemporary comfort afforded many western nations, wherein consumers concentrate on durable goods, and hardly remember the subsistence concerns of previous stages.

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Age of High Mass Consumption

• in the age of high mass consumption, a society is able to choose between concentrating on military and security issues, on equality and welfare issues, or on developing great luxuries for its upper class.

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Traditional / Modern societies• Traditional Society –- Family, Proximity,

Friendship- Customs- Barter- Traditions- Habit- Inertia (need no change)- Religion- Man as Social Man- Communal Property

• Modern Society –- Anonymous relationships

- Contract- Market exchange- Innovation- Novelty (being new)- Progress- Secular- Individualism- Private Property

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Implication of the theories

• Urbanization

• Education

• Socialization

• Industrialization

• Free trade and openness

• Property rights and law

• Deregulation

• Privatization

• Democratization

• Key component was to change culture and attitudes of individuals living in traditional societies so that they are open to modernization and development, rationality and reason

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Major critics

• modernization theory is criticized as biased and ethnocentric, that is, the development categories, stages, and processes involved are all derived from the Western experience rather than from the developing countries. There are other paths available to the Third World countries, and these alternatives neither have to use democratic institutions nor do LDCs need to reach a Western level of development to be considered successful.

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Major critics

• The alleged ‘backwardness’ of ‘underdeveloped’ countries, regions and peoples, was itself a product of the development of the core, developed areas.

• Development and underdevelopment could not be considered in isolation, and nor could it be assumed that contact with ‘the West’ was a benign process; indeed, the development of ‘the West’ rested on the underdevelopment of ‘the Rest’.

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Major critics

• modernization theory misinterprets the role of traditional values and institutions in the economic development, social coherence, and political stability. It was often possible for a Third World country to retain their own traditional cultural attributes along with a modern economy;

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Major Critics

• some radical critics even charge that modernization theory is a political ideology that is tended to promote the Western values and used to justify Western dominance and to keep the Third World in control or “in chains” by which they could resist communist appeals.

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Major Critics

• You cannot simply ignore the structures of the global economy

• The economic solutions it proposes will exasperate poverty in the medium term

• Political solutions questionable?

• Does not properly delineate between different societies

• All cultural explanations of growth pose problem of hitting the target (Catholicism, Confucianism etc )

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Background

• Dependency Theory developed in the late 1950s under the guidance of the Director of the United Nations Economic Commission for Latin America, Raul Prebisch. Prebisch and his colleagues were troubled by the fact that economic growth in the advanced industrialized countries did not necessarily lead to growth in the poorer countries.

Background

• Poor countries exported primary commodities to the rich countries who then manufactured products out of those commodities and sold them back to the poorer countries. The "Value Added" by manufacturing a usable product always cost more than the primary products used to create those products

What is Dependency

• An explanation of the economic development of a state in terms of the external influences--political, economic, and cultural--on national development policies.

• An historical condition which shapes a certain structure of the world economy such that it favours some countries to the detriment of others and limits the development possibilities of the subordinate economics.

What is Dependency

• A situation in which the economy of a certain group of countries is conditioned by the development and expansion of another economy, to which their own is subjected.

Common features dependency theorists share

• Dependency characterizes the international system as comprised of two sets of states, variously described as dominant/dependent, center/periphery or metropolitan/satellite

• External forces are of singular importance to the economic activities within the dependent states. These external forces are means by which the advanced industrialized countries can represent their economic interests abroad.

Common features dependency theorists share

• The relations between dominant and dependent states are dynamic because the interactions between the two sets of states tend to not only reinforce but also intensify the unequal patterns.

• Dependency is a very deep-seated historical process, rooted in the internationalization of capitalism

The Central Propositions of Dependency Theory

• 1. Underdevelopment is a condition fundamentally different from undevelopment. The latter term simply refers to a condition in which resources are not being used.

• Underdevelopment refers to a situation in which resources are being actively used, but used in a way which benefits dominant states and not the poorer states in which the resources are found.


• 2. The distinction between underdevelopment and undevelopment places the poorer countries of the world is a profoundly different historical context.

• South is poor because it was coercively integrated into the European economic system only as producers of raw materials or to serve as repositories of cheap labour, and were denied the opportunity to market their resources in any way that competed with dominant states.


• 3. Alternative uses of resources are preferable to the resource usage patterns imposed by dominant states.

• 4. There exists a clear "national" economic interest which can and should be articulated for each country. that this national interest can only be satisfied by addressing the needs of the poor within a society, rather than through the satisfaction of corporate or governmental needs.


• 5. The diversion of resources over time is maintained not only by the power of dominant states, but also through the power of elites in the dependent states.

• These elites are typically trained in the dominant states and share similar values and culture with the elites in dominant states. hence, a dependency relationship is a "voluntary" relationship.

The Policy Implications of Dependency Analysis

• The success of the advanced industrial economies does not serve as a model for the currently developing economies.

• Market alone is not a sufficient distributive mechanism. It does not allocate the rewards of efficient production in a rational and unbiased manner.


• Their is a very important distinction between economic growth and economic development.

Dependency theorists clearly emphasize social indicators far more than economic indicators hence greater attention is paid to indices such as life expectancy, literacy, infant mortality, education, and the like than the GDP or trade indices


• Dependent states, therefore, should attempt to pursue policies of self-reliance. i.e. endorsing a policy of controlled interactions with the world economy: pour countries should only endorse interactions on terms that promise to improve the social and economic welfare of the larger citizenry.

Policy difficulties

• The internal markets of the poorer countries were not large enough to support the economies of scale used by the richer countries to keep their prices low.

• The political will of the poorer countries as to whether a transformation from being primary products producers was possible or desirable.

• The extent to which the poorer countries actually had control of their primary products, particularly in the area of selling those products abroad.

Criticism of Dependency

• See economic growth as the main component of development

• Maintain the idea that Tradition is the main obstacle to development

• If Western colonialism and Imperialism is the main reason for underdevelopment in the Third World, What aboout China, Ethopiawere colonies of western Europe and are developed.

Criticism of Dependency

• Impractical ideas: If Third World Countries totally dissociate themselves from First they will not gain development. The relationship between Third world and First World is not dependent but interdependent. Globalization

• Undermines the ability of the States to charter development: (Russia and Germany)

• Does not explain the relevance of the Situation of the New International Division of Labour.

World systems perspective

• This perspective builds on the “dependency” approach. But it has a “world systemic” angle.

• Immanuel Wallerstein (1974): The Modern World Economy

• Wallerstein argues that capitalism is a “world economy.”


• The unit of analysis for studying the world economy is the “world” rather than individual nation-states (contra modernization theory)

• The capitalist world economy emerged in the 16th century in western Europe in the wake of the “discovery” of the Americas


• The capitalist world economy consists of a “core,” a “periphery,” and a “semiperiphery.”

• Historically, the core was western Europe, which became industrialized by “extracting surplus” (funneling raw materials and precious metals) from the “periphery.”

• The semiperiphery stood in-between the core and the periphery in terms of incomes and levels of industrialization.

World systems perspective• In this world economy, the core exploited, or

extracted surplus from the periphery in terms of cheap labor, natural resources, raw materials and as markets for European manufactures.

• Example: In the 19th century, the Ottoman Empire was an exporter of dried fruits and nuts to Europe and was dependent on imports of manufactures (“English cloth,” for example). It was heavily indebted to European countries.


• 1) Surplus extraction from the periphery to the core is still ongoing.

• 2) Only a few countries have entered the semi periphery or the core (e.g. South Korea) in the postwar period.

• Wallerstein calls this situation, “development by invitation.”


2) The South Korean “miracle”S. Korea was a special case for two reasons:

a) having geo-political importance for the U.S. and therefore a “favored” economic relationship with it

b) having an authoritarian state which prioritized industrialization at the expense of workers’ rights and democracy until the early 1990s

“Commodity chains”

• A commodity chain: a chain of activities from the manufacturing to the distribution of a final product.

• Peripheral countries are usually specialized in low-profit and labor-intensive links in international commodity chains. Core countries are usually specialized in high profit links of commodity chains.

• Example: the apparel (ready-to-wear clothing) commodity chain includes, cotton growing, textile mills, stitching of garments, design, marketing, distribution, retailing

Apparel commodity chain

• Multinational companies are concentrated in the high profit end of the apparel commodity chains such as design, brand names, high technology and marketing

• Companies in countries such as Turkey and Mexico are concentrated in labor-intensive activities such as the stitching of garments

Apparel commodity chain

• Example: when Levi’s manufactures jeans in Turkey and sells them in Europe, it retains a higher proportion of the profits because of its world-popular brand name.

• In a nutshell, according to the world systems perspective, the capitalist world economy is still a system with structural inequalities between richer and poorer countries

Major Critics(1)The above discussion has shown that

both world-system and dependency theorists, while somewhat different from each other, share the same methodology – “looking outward” and attributing underdevelopment to its external relations in the world market and international system that are governed by the interests of dominant nations and of certain classes and groups in them.

Major Critics

(1)However, both dependency and world-system theorists overlook the impact of the internal constraints of the underdeveloped countries -- the economic, political, social, and cultural characteristics and structures of these countries -- upon the development of the underdeveloped areas and countries.

Major Critics

(2) For the policy implications under this category, breaking-up of the old system is seen as necessary before the establishment of “an equalitarian world-system;” in the meanwhile, the periphery states should cooperate to offset the power of the core.

Major Critics

(2) However, this involves them in a problematic relation with the global economic dynamics that underlies the change of the world-system and the possibilities in the direction of development at every occurrence of upward and downward turns in the world-economy.

References:

• Clark, D.A (2006)The Elga Companion to Development studies. Elga: USA

• Deneulin,S. and Shahani, L (2009) An Introduction to Human Development capability approach. Earthscan. NY

• Pieterse, J.N (2004) Development Theory. Vistaar: New Delh

• Rapley, John. (2002) Understaning development, theory and practice in the third world. Lynne Rienner. London

• Simon, David. (2006) Fifty Key Thinkers in Development. Routledge. London

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