1. Andre Gunder Frank's dependency theory argues that underdeveloped countries are kept in a state of underdevelopment due to their economic dependence on developed "metropolis" countries, which extract economic surplus from satellite underdeveloped countries through trade.
2. The theory posits that underdeveloped countries experience the most development when their ties to the metropolis are weakest, such as during wars or economic crises, or due to geographic isolation.
3. Regions with the closest past ties to metropolis countries, through the export of primary commodities, are now the most underdeveloped, while regions that were able to industrialize saw a decline in dependence on the metropolis.
3. Introduction
We are talking about development, and we are emphasizing
on developing the undeveloped and underdeveloped countries.
But if we want to take any policy, for these countries, at first we
have to look beyond the historical background of these
countries. We should also emphasize on the reasons, for which
the situation of these countries are being unchanged or
decreasing day by day. To giving the theoretical explanation on
this matter, A.G. Frank adopted his Dependency theory which
is named as “The Development of Under-development”.
Here, he emphasized on the development issues and obstacles
for the under-developing countries.
4. Background of the theory
1. Failure of Modernization Theory.
2. Nature, economic situation, technological development
and reality between developed countries and under-
developed countries, colonial and capitalist countries.
3. Marxist view and colonialism(3rd world countries are
sleeping beauty)
4. Paul Baran’s equation-
Economic surplus = production - consumption
(ES) (P) (C)
And
The thinking of Centre –Periphery.
5. More specifically-
This theory came from 4 explanations-
1. Raul Plebish (primary and industrial product) and
ECLA.
2. Failure of ECLA programmed revolution
(programmed industrialization).
3. Marxist thinking and
Neo-Marxism_ Paul Baran(actual and potential surplus).
4. Cuban revolution.
6. Few concepts-
Development: condition of lifestyle and economic
situation is increasing.
Under-development: condition of lifestyle and
economic situation is decreasing.
undevelopment: unchanged situation.
Now-developed: development is on a stable point.
7. New terms from A. G. Frank
Two terms-
1. Satellite.
2. Metropolis.
Satellite- those regions which supplies primary
products.
Metropolis-those regions which sucks satellites and its
wealth.
8.
9. Hypothesis of Frank’s theory
Five hypothesis-
1..Which states are joined to world metropolis, they are
under-developed. i.e.; development occurs when the
state is no ones satellite.
10. 2..The satellites experience their greatest industrial
development and especially their most classically
capitalist industrial development if and when their ties
to their metropolis are weakest.
It occurs in two ways-
I. Crisis of war and depression.
II. Geography and economic isolation.
11. Crisis of war and depression
Crisis of war and depression can weaken the ties of trade and
investment. Then the satellites can go to development.
Cause effect
World wars Argentina, Brazil, Mexico, Chile
become develop
Europe’s 17th century Latin America become industrialized
depression
Napoleonic wars Gave rise to the independence movements
in Latin America
12. Geography and economic isolation
If the geographic and economic isolation break down between
the metropolis and satellite, the satellites will become under
develop.
Cause Effects on Satellites
Meiji restoration Japan able to industrialize so quickly
(china–Japan)
Sea route around Develop LATIFUNDIUM
the Horn(panama canal) (export based commercial economy).
Re-satellization Under-development
De-satellization Development
Un-satellized Satellized Manufacturing destroy
14. 3..The regions which are the most underdeveloped and feudal-
seeming today are the ones which had the closest ties to the
metropolis in the past.
Regions Primary product
West-Indies Sugar
Minas Gerais (Brazil) Mine
Peru, Bolivia Silver
Bengal in India Industrial raw materials
15. 4.. Latifundium evolved on based on the world metropolis
and national metropolis.
5..The latifundia which appear isolated , subsistence
based, and semi-feudal today saw the demand for their
products or their productive capacity decline and they
are to be found principally in the above-named former
agricultural and mining export regions whose economic
activity declined in general.
16. A.G.Frank’s theory and Crime
Crime among the bureaucrats.
Trafficking ( property, labor)
Marginalization and crime.
Inequality and crime.
Reality of survival and crime.
Poverty and crime.
17. Conclusion
If the under-developed regions want to go through the
development, at first they have to isolate from the
Metropolis or the capitalist states. Then they have to gain
independence. If there is any Latifundium, they have to
abolish these practice. They should emphasize on their
internal industrialization through their primary
product, rather than exporting.