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Understanding Dependency Theory in Economics

Dependency theory argues that underdeveloped countries are unable to develop economically due to their dependence on developed nations for resources, capital, and technology. While dependency theory highlights the unequal distribution of power and resources internationally, it also has limitations. It oversimplifies the complex relationships between developed and developing states. Additionally, dependency theory does not provide clear guidance on how developing nations can reduce dependence or achieve economic growth. Overall, dependency theory draws attention to important issues, but its weaknesses must be acknowledged to effectively address development challenges.

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John Peter
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52 views1 page

Understanding Dependency Theory in Economics

Dependency theory argues that underdeveloped countries are unable to develop economically due to their dependence on developed nations for resources, capital, and technology. While dependency theory highlights the unequal distribution of power and resources internationally, it also has limitations. It oversimplifies the complex relationships between developed and developing states. Additionally, dependency theory does not provide clear guidance on how developing nations can reduce dependence or achieve economic growth. Overall, dependency theory draws attention to important issues, but its weaknesses must be acknowledged to effectively address development challenges.

Uploaded by

John Peter
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Name: Navierge Frederick

Geography Essay

Dependency theory is a socio-economic theory that suggests that underdeveloped countries


are unable to develop due to their dependence on developed countries for resources,
capital, and technology. The theory was developed in the 1950s and 1960s by scholars from
Latin America who were critical of the dominant economic theory at the time, modernization
theory. Dependency theory argues that economic development is not a linear process and
that the international economic system is fundamentally unequal. While dependency theory
has been useful in highlighting the issues faced by developing countries, it also has its
limitations.

One usefulness of the dependency theory is that it highlights the unequal distribution of
resources and power in the international economic system. Dependency theory emphasizes
that developed countries exploit the resources of developing countries, which hinders their
economic growth. For example, developing countries are often rich in natural resources, but
they lack the technology to extract and process them, forcing them to export raw materials to
developed countries. This results in the developed countries gaining more from the
relationship than the developing countries, which is not fair. Dependency theory thus
highlights the need for a more equitable international economic system that will promote the
growth of developing countries.

However, dependency theory also has its limitations. One limitation is that it tends to
oversimplify the complex relationships between developed and developing countries.
Dependency theory assumes that developed countries are always exploiting developing
countries, which is not always the case. In some cases, developed countries do provide aid
and investment to developing countries, which helps them to grow economically.
Dependency theory also does not take into account the role of domestic factors in economic
development, such as governance, corruption, and the availability of human capital.

Another limitation of dependency theory is that it does not provide a clear roadmap for
economic development. Dependency theory emphasizes the need for developing countries
to reduce their dependence on developed countries, but it does not provide clear guidance
on how to achieve this. Dependency theory tends to focus on the negative aspects of the
relationship between developed and developing countries, rather than providing solutions to
address the root causes of the problem.

In conclusion, dependency theory has been useful in highlighting the unequal distribution of
power and resources in the international economic system. It emphasizes the need for a
more equitable system that will promote the growth of developing countries. However,
dependency theory has its limitations. It oversimplifies the complex relationships between
developed and developing countries, and it does not provide a clear roadmap for economic
development. Therefore, policymakers and scholars need to recognize the strengths and
weaknesses of dependency theory to develop effective policies to promote economic growth
and reduce dependency.

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