Discussion of modernisation and dependency theorypdf_ico
This essay shall discuss two theories of development – modernisation and dependency theory (MT and DT). In this limited space, I shall narrow my analysis down to two of the staunchest representatives of each camp: Walt W. Rostow and André G. Frank. Also, because it is impossible to discuss their broad publications, I shall subject only the very core of their theories to scrutiny here. After (1) a quest for the shared assumptions of both theories, this account will discuss (2) Rostow’s idea of stages of economic growth (1959) and (3) Frank’s notion of development of underdevelopment (1966), both with their policy implications1. I will treat these mutually exclusive ideas as thesis and anti-thesis and shortly discuss (4) the direction into which a synthesis could go (and maybe has gone).
1. Shared Assumptions
Both theories seem to have some ‘faith in the efficacy of urban-based industrial growth’ (Potter et al. 2008, p. 942). Interestingly, even though Frank accuses MT of Eurocentrism (1966, p. 17), he never reflects whether industrialisation per se (with all the institutions that come with it) is a European concept in itself, a consideration I would have expected (Frank 1966, 1975). This shows that both scholars share the following paradigmatic assumption: Development necessitates industrialisation.
However, whereas MT is much more a theory of economic growth rather than about development (Binns 2002, p. 79), DT rejects the narrow informational basis of MT (GDP and trade indices) and focuses on a range of indicators (Ferraro 1996), much like nowadays Sen (1999) and the Human Development Index.
One could argue that the lack of dialogue and acceptance between the two schools is due to the cold war context within which they emerged. Rostow was a fierce anti-Marxist3 whereas Frank was exactly that, a Marxist. 2. The unilinear growth of MT
Rostow’s stages of economic growth (Rostow 1959, Binns 2002, Potter et al. 2008, pp. 89-91) assumes that the South ought to imitate the North in its path of development. It is important not to confuse Rostow’s theory with modern neo-liberal free-trade – he, for example, allows for import substitute industrialisation (Potter et al. 2008, p. 91). One can, however, advance the same criticism against stages of economic growth like against any theory of any evolutionary process within spacial boundaries other than the whole planet (e.g. classical Marxism), namely the idea of diffusionism (Macfarlane 2001, 32:30): Considering that ideas travel, to argue that every country needs to evolve through necessary evolutionary steps is implausible. A country must be able to ‘jump’ steps because it is informed by its neighbours – and so countries did (Binns 2002, p. 79). MT’s anti-thesis, DT, could be seen in this light as trying to respect this principle.
The policies that Rostow deduces from his model that developing countries ought to implement are found in his description of the stage ‘preconditions for take-off’ (1959, p. 5-8):
First, a build-up of social overhead capital, notably in transport. […] Second, a technological revolution in agriculture. […] Third, an expansion in imports financed by the more efficient production and marketing of some natural resources plus, where possible, capital imports. […] Framed by these three forms of sectoral development, yielding both new markets and new inputs for industry, the initially small enclaves of modern industrial activity could begin to expand, and then sustain expansion, mainly by the plough-back of profits (ibid. p. 5).
In the non-economic dimensions this requires the willingness to accept new technologies (especially agriculture), free enterprise, a government capable of enforcing law and order and investing in infrastructure, acceptable terms of trade and the spread of new technology (ibid., p. 5-6).
Most important for the argument here is that Rostow’s theory of...
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