Dependency Theory

Dependency theory is a body of economic thought, formulated after the Second World War chiefly by Raul Prebisch and Hans Singer and developed further by writers such as Andre Gunder Frank, Fernando Henrique Cardoso and Walter Rodney, that explains the persistent poverty of the developing world as a structural consequence of its position within the global economy rather than as a stage every country passes through on the way to development. It holds that resources flow from a periphery of poor, resource-exporting states toward a core of wealthy, industrialized states, and that this exchange enriches the core at the periphery's expense rather than lifting the periphery toward it. The theory arose as a direct challenge to modernization theory, which treated underdeveloped countries as earlier versions of developed ones destined to catch up through the same stages of growth. Prescriptions associated with the theory included import substitution industrialization and, in some of its more radical variants, delinking from the world market altogether. The theory's influence on mainstream development economics receded from the 1990s onward, but its core diagnosis of unequal exchange between rich and poor nations continues to shape debates over trade policy and fair trade movements. This description is adapted from Wikipedia contributors under CC BY-SA 4.0; changes were made. https://creativecommons.org/licenses/by-sa/4.0/