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Rostows Stages of Development and Wallersteins World-Systems Theory

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DevelopmentRostow: Ladder of Development 1. What sectors of the economy do you see? 2. What are the economic and social characteristics of LDCs? 3. Where do we find MDCs and LDCs on the globe?

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5-stage model Traditional society Preconditions for take-off Take-off Drive to maturity High Mass Consumption Countries climb (the ladder) from one stage to another

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Little technology No social changes Moves to next stage when other countries invest in resources or new markets appear. (Role of IMF, World Bank, WTO???) Ex: OIL! GOLD! Minerals!

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Commercial companies invest Plantation agriculture Garment industry MiningWHY THESE?? Moves to next stage when roads/railroads (infrastructure improves) and social and political leaders emerge.

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Development of manufacturing (a countrys own companies for export) Moves to next stage with even more investment in this sector and the creation of modern social, economic, and political institutions

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Drive to Maturity Development of economy beyond manufacturing (widening base of industry and business) Moves to last stage when it can take advantage of its abilities to produce for both the export and domestic markets. Assumes a middle (consumer) class

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High Mass ConsumptionTop of the ladder People buy a lot of stuff. WE HAVE ARRIVED!! Key Question: How would Rostow view the IMF, World Bank and WTO?

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Explain the 5-stages Traditional society Preconditions for take-off Take-off Drive to maturity High Mass Consumption

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Core, Semi-Periphery, Periphery

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The world is ONE economic market with a global division of labor Three levels: Core Semi-Periphery Periphery

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Wallerstein Present Core/Periphery Relationships In Wallersteins theory, countries can move from one level to another.

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The worlds richer countries Wide range of products and services High wages Import raw materials and export manufactured goods/services Have favorable trade balances with poor countries Build up capital which is invested largely at home Invest in other core country economies Valuable trade with other core countries

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Poorer countries Limited products Limited technology Lower wages Dependent on core countries to purchase goods, provide capital, etc. This dependency is the root of many global problems/conflicts Supply raw materials Generally exploited by core

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Transition between core and periphery Lower value-added manufactured goods for export Still have dependent relationships with cores Have peripheral countries dependent on them South Korea, Mexico, Argentina, Thailand, Malaysia are examples of Semi-Periphery countries moving up

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Dependency Theory The political and economic relationships between countries and regions of the world control and limit the economic development possibilities of poorer areas. Economic structures make poorer countries dependent on wealthier countries. Colonialism initiated dependency Little hope for economic prosperity in poorer countries. Neo-colonialism

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Key Question:

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Low Levels of Social Welfare Foreign Debt Political Instability Widespread Disease

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Foreign Debt Obligations Total interest payments compared to the export of goods and services.

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Malaria kills 150,000 children in the global periphery each month. Tamolo, India This baby sleeps under a mosquito net distributed to villagers by UNICEF workers.

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Global Distribution of Malaria Transmission Risk

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Key Question:

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Development variations in America

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Governments get involved in world markets price commodities affect whether core processes produce wealth shape laws to affect production enter international organizations that affect trade focus foreign investment in certain places support large-scale projects

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Governments and Corporations can create Islands of Development Places within a region or country where foreign investment, jobs, and infrastructure are concentrated.

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The global oil industry has created the entire city of Port Gentile, Gabon to extract Gabons oil resources.

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Malaysian government built a new, ultramodern capital at Putrjaya to symbolize the countrys rapid economic growth.

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Somalia Microcredit program: loans given to poor people, particularly women, to encourage development of small businesses.

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The world is ONE economic market with a global division of labor Explain the relationship: Core Semi-Periphery Periphery Key Question: What happens when the majority of countries move from periphery to core?.. Can they/will they?