Relacoes Internacionais e Desenvolvimento A Pereira PRI 5058

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Relacoes Internacionais e Desenvolvimento A. Pereira PRI 5058 Lecture 3 Critical structural theories of

Relacoes Internacionais e Desenvolvimento A. Pereira PRI 5058 Lecture 3 Critical structural theories of development

Questions • How has capitalism been linked to imperialism? • What did A. G.

Questions • How has capitalism been linked to imperialism? • What did A. G. Frank mean by the “development of underdevelopment”? • How relevant are critical structural theories of development to understanding the contemporary world economy?

Outline • • • Group exercise Marxism Modernization theory Dependency theory Conclusion

Outline • • • Group exercise Marxism Modernization theory Dependency theory Conclusion

Group exercise • Each group should come up with two critical structural theorists of

Group exercise • Each group should come up with two critical structural theorists of the world economy. Describe his or her key idea about the world economy and Brazil’s relationship to it. Compare and contrast these two ideas.

Development policies influenced by some variant of Marxism • 1929 -39: forced collectivization of

Development policies influenced by some variant of Marxism • 1929 -39: forced collectivization of Soviet agriculture and push into heavy industry • 1958 -62: “Great Leap Forward” in China • 1950 s: Creation of Indian state-owned steel sector • 1961: Cuban nationalization of sugar sector and land reform • 1970 -73: nationalizations in Chile • Today: ?

Marxism • ?

Marxism • ?

Some elements of Marxism • Class as a key unit of analysis • Dichotomy

Some elements of Marxism • Class as a key unit of analysis • Dichotomy between capital and labour as the motor of history • Universal teleology: stages of history with communism as the highest stage • The role of the proletariat (workers), peasantry, and vanguard party are crucial • Major theorists: Marx and Engels, Lenin, and Mao

Other elements of Marxism • Ownership of the means of production as a fault

Other elements of Marxism • Ownership of the means of production as a fault line in society • The division between state and market in liberal society is ideological • Critique of alienation in capitalist society • The ‘forces of production’ determine the ‘relations of production’ and the political ‘superstructure’ • Recognition of globalization (see The Communist Manifesto)

Historical materialism • “It is not the consciousness of men that determines their being,

Historical materialism • “It is not the consciousness of men that determines their being, but on the contrary it is their social being that determines their consciousness. ” » A Contribution to the Critique of Political Economy, p. 46 • The dominant ideas of any epoch are the ideas of the dominant or ruling class.

Property and exploitation • In the transition from feudalism to capitalism, workers are separated

Property and exploitation • In the transition from feudalism to capitalism, workers are separated from the means of production through a process of ‘primitive accumulation’. “In actual history it is notorious that conquest, enslavement, robbery, murder, briefly force, play the great part [in the accumulation of property]” (Capital Vol 1 Part VIII, p. 668). • Under capitalism, “surplus value” is extracted from workers. The fruits of their labour are sold back to them at a profit by capitalists.

A theory of history • The development of capitalism will lead to the increasing

A theory of history • The development of capitalism will lead to the increasing socialization of the means of production (concentration into larger units of production) and the increasing immiseration of the working class. • The working class will become revolutionary – shift from being a class “in itself” to a class “for itself”.

The civilizing influence of capital • “Hence the great civilizing influence of capital; its

The civilizing influence of capital • “Hence the great civilizing influence of capital; its production of a stage of society in comparison to which all earlier ones appear as mere local developments of humanity and as nature-idolatry…For the first time nature becomes purely an object for humankind, purely a matter of utility…Capital drives beyond national barriers and prejudices as much as beyond nature worship, as well as beyond all traditional, confined …ways of life. It is destructive towards all of this…tearing down all the barriers which hem in the development of the forces of production…” (Marx, Grundrisse)

A view of colonialism The ‘traditional’ economic base of life was being destroyed by

A view of colonialism The ‘traditional’ economic base of life was being destroyed by British economic influence. Capitalism: “dissolved these small semi-barbarian, semi-civilized communities, by blowing up their economic base, and thus produced the greatest social revolution in India”. (Marx, The British Rule in India)

Marx: development as an inevitable evolution of modes of production and corresponding social (class)

Marx: development as an inevitable evolution of modes of production and corresponding social (class) relations of production Socialist mode of production Asiatic mode of production Primitive mode of production Feudal mode of production Capitalist mode of production Slave mode of production 15

Marxism • It is dialectical (Marx was influenced by his professor G. W. F.

Marxism • It is dialectical (Marx was influenced by his professor G. W. F. Hegel). • It is Eurocentric in that it sees capitalist development in Europe as the highest stage of history and the future of the rest of the world. • Its view of history is universalistic and teleological (“A spectre is haunting Europe – the spectre of Communism”). • It was attractive to and adapted by intellectuals in developing countries. It was Western, but critical of the history of the West.

Marxist theories of imperialism • Many Marxists saw imperialism as driven primarily by economic

Marxist theories of imperialism • Many Marxists saw imperialism as driven primarily by economic forces, especially the development of “monopoly”, finance capitalism and overproduction in domestic markets. • See V. I. Lenin, Imperialism as the Highest Stage of Capitalism (1916). • Liberals argued that imperialism was not driven exclusively by economic forces.

Criticisms of Marxism • The assumption of increasing class polarization in advanced capitalist countries

Criticisms of Marxism • The assumption of increasing class polarization in advanced capitalist countries was questionable. • Revolution was more likely in the periphery, not the capitalist core. • Class is not “objective”, but has to be socially constructed, and competes with other identities. • Central planning of complex economies creates distortions and stifles innovation.

Modernization theory • ?

Modernization theory • ?

Development policies influenced by modernization theory • USAID assistance, especially in the 1950 s

Development policies influenced by modernization theory • USAID assistance, especially in the 1950 s and 1960 s • The Alliance for Progress in Latin America under President JFK, 1961 -63 • US policy in South Vietnam, 1960 s • The “Green Revolution” of the 1950 s and 1960 s • Conservative modernization under a variety of pro -Western regimes • A contemporary theorist: F. Fukuyama, Political Order and Political Decay (2014).

Modernization theory • Dichotomy between traditional and modern societies • Universalist teleology: stages of

Modernization theory • Dichotomy between traditional and modern societies • Universalist teleology: stages of modernization, with advanced capitalism and liberal democracy as the highest stage. • The role of the middle class, entrepreneurs, and state managers is crucial. • Key theorists: German sociologists Weber and Tonnies, interpreted by US social scientists such as T. Parsons and W. Rostow

Other elements of modernization theory • A stylized history of early developers was posed

Other elements of modernization theory • A stylized history of early developers was posed as a model for developing countries • Tradition was seen as ascriptive, personalistic, and rural; modernity as achievement-oriented, contractual and urban • The Lewis model: the marginal utility of labour in agriculture was zero

More on modernization theory • Emphasis on the “big push” of investment allowing “take-off”

More on modernization theory • Emphasis on the “big push” of investment allowing “take-off” into self-sustaining development • Faith in government planning and large projects • Explicitly anti-Marxist and anti-Communist (W. W. Rostow, The Stages of Economic Growth: A Non-Communist Manifesto, 1960).

Rostow’s model Age of high mass consumption Take-off and destruction of traditional barriers Traditional

Rostow’s model Age of high mass consumption Take-off and destruction of traditional barriers Traditional society Preconditions for take-off: new ideas Drive to maturity

Development in modernization theory • Capitalist development creates a property owning middle-class (small farmers

Development in modernization theory • Capitalist development creates a property owning middle-class (small farmers in the countryside) with an interest in political stability. • Capitalist development goes hand in hand with “political development” towards liberal democracy.

Criticisms of modernization theory • Euro- or often US-centric • The dichotomy between traditional

Criticisms of modernization theory • Euro- or often US-centric • The dichotomy between traditional and modern was often questionable – ascription and tradition exist in advanced capitalist countries • The idea that the stylized history of Europe would be repeated elsewhere was questionable (as in Marxism) • In developing countries, capitalist development often led, not to stability and liberal democracy, but democratic breakdown and authoritarian rule • Development was seen as autochthonous – there was a lack of attention to the constraints on development imposed by international political economy and geo-politics

Dependency theory • ?

Dependency theory • ?

Development policies influenced by some variant of dependency theory • Economic Commission for Latin

Development policies influenced by some variant of dependency theory • Economic Commission for Latin America (ECLAC or CEPAL in Spanish) recommendations • Import-substitution industrialization by developing states • Nationalization of foreign firms, restrictions on profit remittances, 1960 s and 1970 s, laws requiring national owernship of shares of MNCs • Breaks with the capitalist world economy (i. e. Cuba after 1959)

Dependency theory • Dichotomy between capitalist core and periphery • Attack on static comparative

Dependency theory • Dichotomy between capitalist core and periphery • Attack on static comparative advantage, emphasis on declining terms of trade for commodities • Break with universalistic teleologies – emphasis on the specific trajectories of dependent capitalist countries • National capitalists, workers, and nationalist state managers as important actors • Theorists: Andre Gunder Frank, Fernando Henrique Cardoso, Theotonio dos Santos

Dependency theory • The process of capitalist accumulation is controlled largely from outside the

Dependency theory • The process of capitalist accumulation is controlled largely from outside the national territory. • Capitalism’s essential feature is exchange: global trade (not wage labour or the reinvestment of profits by firms). Peripheral economies are shaped by their relationship to external markets. • Global trade is marked by chains of exploitation (i. e the Brazilian state protects infant industries in Sao Paulo through tariff barriers, which underdevelops the Brazilian northeast, creating a chain of Europe/US – Sao Paulo – the Brazilian northeast.

Other elements of dependency theory • Importance of colonial economic history • “Comprador bourgeoisie”

Other elements of dependency theory • Importance of colonial economic history • “Comprador bourgeoisie” as a drag on development • Rejection of dualism (traditional sector vs modern sector) and analysis of specific economies in global context • Dependency on external capital, markets, firms, and technology results in underdevelopment or at least dependent development • Policy prescriptions include a break with the capitalist world economy (Frank) or measures to develop the domestic market and steer development towards more autonomous and national forms

Still more elements • The world capitalist market has to be examined as a

Still more elements • The world capitalist market has to be examined as a global whole, not to be disaggregated into national economies to be compared separately (as in comparative politics). • Development and underdevelopment are two sides of the same coin. • Imperialism was not progressive but intensified underdevelopment in the periphery. • The more ‘dependent’ on foreign trade a country was, the more underdeveloped it would be. Some of the most impoverished parts of the developing world (Bolivia, Haiti) had been some of the wealthiest.

Frank vs ECLA vs theorists of dependent development • The ECLA school recommended import

Frank vs ECLA vs theorists of dependent development • The ECLA school recommended import substitution industrialization, land reform to eliminate unproductive large estates, and the development of a nationally-oriented capitalist class. • For A. G. Frank, this was reformism that would not work. A radical break with international capitalism was necessary. • For Cardoso, dependence does not create “underdevelopment” in an absolute sense – dependent economies, especially ones with large markets and/or effective states – can industrialize. However, dependent development is marked by inequality, weak capitalist and middle classes, and (often) authoritarian regimes.

Criticisms of dependency theory • The alleged tight correlation between dependency and underdevelopment was

Criticisms of dependency theory • The alleged tight correlation between dependency and underdevelopment was questioned (ie. Cardoso’s criticism of Frank) • Colonialism and neo-colonialism seen developing the forces of production, not underdeveloping them (Marxist and modernization theory critique) • Over-generalization: failure to account for the variety of development trajectories in the developing world, i. e. Bolivia and Chile, S. Korea and N. Korea, Costa Rica and Nicaragua

It must be noted that MICs represent a much larger group of countries c

It must be noted that MICs represent a much larger group of countries c Global economic growth is the result of increasing

Conclusions The impact of imperialism on developing countries is contested in development theory. For

Conclusions The impact of imperialism on developing countries is contested in development theory. For some (Marxists and modernization theorists) it was a progressive force, whereas for others (dependency theorists) it was a regressive one. has capitalism been linked to imperialism? A. G. Frank, a student of Milton Friedman’s at the University of Chicago, turned modernization theory on its head by coining the phrase the “development of underdevelopment”, and also defied traditional Marxism.

Conclusions (2) All three approaches (Marxism, modernization theory, and critical structural theories) have analytical

Conclusions (2) All three approaches (Marxism, modernization theory, and critical structural theories) have analytical limitations. The critical structural turn in development theory can be useful by forcing us to look at the world economy as a whole, and patterns of national and regional development within it.

Conclusions (3) • The contributions of the “associated dependent development” school (including FH Cardoso)

Conclusions (3) • The contributions of the “associated dependent development” school (including FH Cardoso) and world systems approach were crucial in adding nuance to the binary approach of AG Frank, which was basically modernization theory flipped on its head. That is because these approaches recognized the possibility of economic development under conditions of dependency.

For next time: • What is postdevelopmentalism? What are the postdevelopmentalists’ proposed alternatives to

For next time: • What is postdevelopmentalism? What are the postdevelopmentalists’ proposed alternatives to conventional development theory and practice?