Presentation on theme: "World Systems Approach"— Presentation transcript:
1World Systems Approach Builds on Dominance – Dependence TheoryCountries don’t go through stages – the “system” doesAlso believes that countries are poor because they are stuck on the “periphery” or edges of the world economy – and kept there by “core” countriesUses the term “Core” instead of “Centre” for the Dominant states
2World Systems Approach Late 18th / early 19th centuries marked a turning point in capitalism – capitalists achieved power in key countries which furthered the industrial revolution (eg Britain).Believes there are three types of countriesCore = Centre / DominantSemi-periphery = Cores on the way “down”, or Peripheries on the way “up”!Periphery = Dependent
3World Systems Approach Core countries:The most economically diversified, wealthy, and powerful (economically and militarily)Have strong central governments, controlling extensive bureaucracies and powerful militariesHave more complex and stronger state institutions that help manage economic affairs internally and externallyHave a sufficient tax base so these state institutions can provide infrastructure for a strong economy
4World Systems Approach Core countries:Highly industrialized; produce manufactured goods rather than raw materials for exportIncreasingly tend to specialize in information, finance and service industriesMore often in the forefront of new technologies and new industries. Examples today include high-technology electronic and biotechnology industries. Another example would be assembly-line auto production in the early twentieth century.Has strong bourgeois and working classesHave significant means of influence over noncore nationsRelatively independent of outside control
5World Systems Approach Core countries: gain -Access to a large quantity of raw materialCheap labourEnormous profits from direct capital investmentsA market for exportsSkilled professional labour through migration of these people from the periphery to the core.
6World Systems Approach Core countries:Sometimes one core country or region will become a “hegemon” or “super-core”Portugal / Spain in the 16th centuryNorth-West Europe (France, Holland, Britain) in the 18th / 19th centuriesUSA in the 20th century
7World Systems Approach Semi-periphery countries:Part way between the core and periphery.Usually countries moving towards industrialization and a more diversified economyBut can come from declining cores.
8World Systems Approach Semi-periphery countries:They may be dominated by core countries, but may also partially dominate periphery countriesSpain and Portugal: - fell from their early core position, but still manage to retain influence in Latin America. They imported silver and gold from their colonies, but then had to use it to pay for manufactured goods from core countries such as England and France.
9World Systems Approach Periphery countries:Least economically diversifiedRelatively weak governmentsRelatively weak institutions with little tax base to support infrastructure developmentDepend on one type of economic activity, often on extracting and exporting raw materials to core nations, cash crops etcLeast industrialized
10World Systems Approach Periphery countries:Targets for investments from multinational corporations. Come into the country to exploit cheap unskilled labour for export back to core nationsSmall bourgeois and large peasant classesHigh percentage of people poor and uneducated.Inequality very high - a small upper class (elite) owns most of the land and has profitable ties to multinational corporations
11World Systems Approach Periphery countries:Extensively influenced by core nations and their multinational corporations. Many times they are forced to follow economic policies that favour core nations and harm the long-term economic prospects of periphery nations.Historically, peripheries were found outside Europe, for example in Latin America, Asia, Africa.
12World History According to the World Systems Approach 15th century – Spain and Portugal lead the way but overextended themselves with empire buildingGained huge wealth from colonies but fell behind in industrial production17th century – Holland with its new financial system based on global capitalism (which others copied eg Britain)Holland also had many colonies eg East IndiesAs the Dutch economy grew and standard of living rose its costs of production went up! Began to invest overseas eg British industry
13World History According to the World Systems Approach 19th century – Britain became the “hegemon”Highly industrialised, capitalism thrivingMassive growth in colonisation eg NZThis cost a lot of money so their clear dominance endedBy 1900 the old European “core” claimed 85% of the world’s territory!The only way to gain land was through war against other “core” nations – eg Germany, Japan, ItalyA truly “global economy” emerging
14World History According to the World Systems Approach Post World War 1 – the “American Century” – USA a “hegemon”Rapid industrialisation after the 1860’s Civil War, helped by investment from Britain, HollandAfter World War 2 the USA had over ½ the world’s industrial production, 2/3 of gold reserves, 1/3 of world’s exportsSince the 1990’s USA “hegemony” has been eroding.
15World History According to the World Systems Approach The “core” is now Europe + USA + JapanOthers approaching eg South Korea, ChinaSemi – periphery = states that have been long independent but have not yet reached Western levels of influence eg Brazil, India? NZ and Australia?Periphery = poor former Western colonies eg Southeast Asia, Africa
16Major CriticsThe 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. 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.
17Major 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. 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.
18Who is right?Three theories have provided three solutions to the Third World development:- Increase of modernity- Independence and de-linking from the world economy- Reform of the world systemQ: Which side do you think has more power for explaining the Third World development in the last several decades?