Development: Part 3

Dual Theories

• Acknowledged that instead of evening out differences, differences continued to persist both between and within countries between traditional/peripheral areas and “modern”/core areas

– Thought it could be overcome by investing in peripheral areas, hiring away agricultural labor, etc.

Import Substitution

• Economic Commission for Latin America in Keynesian tradition did study, determined that

– Labor had been able to keep wages high in advanced countries, passing costs on to developing world consumers

– Primary products prices have fallen, but since most are exported, rich world consumers benefit

• And so, went to ISI

– An attempt to replace imports with domestically produced substitutes

– Came about in 1960’s and 1970’s, as a way to move into lucrative, key industries without necessarily having an initial comparative advantage

• Breaks dependency on foreign money & goods

– By eliminating more advanced foreign competition, guarantees domestic market and time to for the company to mature enough to compete internationally

• United States, Germany, Japan have done this at one point or another

ISI (cont.)

– Done by:

• putting tariffs (import taxes) on competing products

• reducing tariffs on inputs for the newly domestically produced goods

• providing loans/grants for firms

– Success patchy at best:

• Brazil got decent transport, steel and pharmaceutical firms from this

• Very few domestic markets big enough for firms to achieve any level of efficiency

• Does not decrease inequality

– Goods produced for elites/middle classes

– Total imports often increased, because often only assembly happened locally

• Taiwan and S.K. find success using similar model for producing exports

Dependency Theory & World Systems

• Andre Gunder Frank showed that even remote parts of Chile & Brazil had been involved with the capitalist economy since 1600’s

– Thus capitalism as experienced there must of helped create underdevelopment and dependency

– Capitalist countries need this underdevelopment for their development

– Argued that any form of capitalism wouldn’t help

• Samir Amin and Emanuel Wallerstein developed World Systems Theory

– Looked at whole world as part of capitalist system

• Includes core, periphery and semi-periphery

• Though note non-capitalist production continues to exist side by side

World Systems Theory (cont.)

– Amin said the temptation of using low wages in periphery for manufacturing leads to overproduction;

• Wallerstein argued that this leads to cyclical crashes where weak firms are weeded out and productivity increases

– Also is an opportunity to move between levels (although the number of countries in each level is stable)

» System doesn’t work if all well off

• Accused of ignoring conditions w/in states; things happen b/c “system” demands it; does not explain success of developmentalist states like South Korea which have become more propserous

Development Critiques

• But all these (even world systems) are economistic theories

• There have been other theories practiced (as much as written), which argue that there are other ways to represent the world situation

– Gandhi changed the politics of representation, making the British appear alien instead of superior

• At the core: though malnutrition and environmental damage existed previously, most efforts at development have made things worse for the most vulnerable (usually rural, poor and female)

– For example, highways are meant to allow small farmers to access markets. Instead, it allows cheap imported food in to undermine local farmers

– Long been movements against the insensitivities of development

• In thinking this way, to believe you need development, means to accept your tradition as inferior and in need of changing

Development Critiques (cont.)

• Women in Development (WID)

– In the 1970’s, feminist authors like Esther Bosrup, noticed that development only addressed women as wives and mothers, not as economic breadwinners

• In Women’s Role in Economic Development, she showed that there were different economic roles for women depending on place, and that especially in Sub-Saharan Africa and Southeast Asia, women participated widely in the farming economy but had no access to formal credit

– Showed that planners had not taken women into account in their policies at all

– Development agencies, even by the 1980’s, accepted this as a true critique, and eventually development professionals and policy were increasingly gender balanced

• Critiques of Women in Development

– Like other forms of development, though, it came to be dominated by Western and Western educated women and colored by their views of universal sisterhood (and these women’s class position)

• For example, a woman from a wealthy family in India (or wherever), who goes to Harvard or Oxford probably has very little in common with a peasant woman from her own country

– Others said sometimes WID focused too heavily on changing patriarchy, without recognizing that both poor men and women need systemic economic changes

Development Critiques (cont.)

• Experts (though often for noble reasons) dominate development processes, and only their knowledge counts

– Experts (unconsciously) try to make the on ground reality fit what they know, to reduce it to something they understand

– Especially applied sciences (agronomy, forestry, husbandry, civil engineering) are one particular view of how to use a resource

• To transfer commodities to upper classes, development often creates other types of scarcity, degrades environment, undercut physical and cultural support systems

• In focusing on GDP growth, ignores the effects of self-provisioning of food, housing, clothing

– Often in terms of mining, state takes land used for something else without fair compensation

• Also, the nation state for too long was taken as the appropriate unit to target development policy, allowing those states to siphon off and direct benefits, while ignoring the internal diversities of most countries

Movements to improve livelihoods

• Environmental movements (against forestry, mining, dams) are amongst the most common

– In many places, people get benefit from land in ways that cannot be commodified

• Also some value ecosystems as having value in their own right, beyond whatever “use” they are to humans

– Often it is women who lead these movements, who get subsistence from these areas which are ignored in GDP and undervalued by development experts

• Urban movements want housing, water, health care, education and sewage disposal

– Some communities have organized self-improvement movements, where everyone pitches in for resources and together supply labor

– Community, not gov. decides what is needed

Alternative(s to) Development as it has been done.

• Must be:

– participatory

– gender inclusive

– sensitive to ecosystems and present patterns

• It is also should be locally controlled, not driven by a universal model

• In the last 5 years, most major development institutions now at least have begun to pay lip service to all these things