Business management and development assignment essay writing help analysis: Theory of modernization – Eduardo Theory
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Introduction
The theory of modernisation and dependency has been around from the mid-1950s. With a 6 decade long old journey they both provide valid as well as the perfect explanations with respect to the development and underdevelopment happening globally. Both of them come with notable likeness but have several differences as well. Both of these theories also have been prone to numerous criticisms for being applicable to various aspects.
Modernization Theory
The Modernisation theory was developed much before the dependency theory in the mid-1950s. It was based on 4 main assumptions. It mentioned that the western societies are much technologically, socially and politically advanced. It also mentions that countries go through phases before they actually achieve the tag of being developed. The phases are defined as the natural form of development and passes through several hurdles before achieving their goals. The theory also mentions that there is every possibility that the underdeveloped nations could advance without making any changes to the financial or trading patters to the capitalist world (UTWENTE n.d.).
The modernisation theory sees the cause of nations to be underdeveloped as the lack in their abilities whereby the dependency theory states the reason for the same as the exploitation of the advanced nations. An argument by W.W. Rostow had put the point that there are a series of stages which a traditional society passes through for becoming a modern society. He was one of the most notable modernisation theorists and his work was in combination with the four key elements of the theory. His own model of the stages was based upon the British industrial revolution. The idea put across by him states that every country needs to pass through 5 stages of economic growth.
- Starting of traditionally: These countries include the ones which are mostly dependent on agriculture and lack the scientific and technological knowledge. Somalia can be one of those examples who feature in this stage today.
- New trade and industries: This is the stage where a country witnesses an increase in its trade activities and emergence of industries is seen. Emergence of an elite as well as traditional society backed by scientific and technical investment is also among the characteristics. A country which could today be seen through passing this stage of development would be Ghana.
- Take off: At this stage investment grows to around 10% of the total income of the country. Here the countries continue their growth in both social and political ways. The country which could be seen to fall in this stage today would be Botswana.
- Drive towards maturity: This stage involves investment, political and social reforms which continue to grow at a rapid phase. Countries such as China, Russia and India could well be seen as the ones passing through this stage.
- Mass Consumption: This is the final stage of being labelled as an advanced nation. It features high economic production and a very elite society. The features include big spending power and huge investment as well as growth opportunities.
Dependency Theory
The creation of the dependency theory was a part of a response to the western-centric mindset of the modernization theory. The theory reflects the global inequality as being the outcome of core nations who exploit the semi-peripheral nations by creating a cycle of interdependence. The theory explains that till the time when the peripheral nations are dependent on the core nations for their economic development giving them an access to a larger piece of global economy, the possibility of reaching a stable and consistent economic growth would be difficult (Wisegeek n.d).
The theory goes on to mention that as the World Bank as well as the core nations make their choices for granting loans for specific purposes to the peripheral nations they create a highly segmented labour market. This in turn is seen as a measure to add to the benefits which the dominant market companies already have. An overview of this theory may seem to ignore the fact of that low-income nations have now moved to become high-income nations and are among the big contributors to the global economy. However many dependency theorists have stated that it would be good for the core nations to ensure they have a long-term usefulness of the peripheral as well as the semi-peripheral partners. Continuing with the theory the sociologists have observed that entities are highly likely to outsource a big chunk of their business operations only if they feel they are the dominant player in the equation. Simply stating it means that the companies from the core countires prefer that their partner countries are healthy enough to provide the work which is expected out of them. However they also ensure that these countries are not advanced or healthy enough to establish a threat to them and the other core country companies.
Comparing the Modernization theory with the Dependency Theory
From the time when the theories were developed the researchers have constantly been tracking the third world countries to find out the possible reasons for them to be underdeveloped. The two popular theories which have emerged as an explanation to the reasons for the third-world countries are: (Marked by teachers 2008)
- Eduardo Galeano’s Open Veins in America: This theory explores the dependency theory which explains that the result of underdevelopment was due to the centuries of colonial expansion.
- Lawrence Harrison’s modernization theory: As per this theory it examines the conquest which was led by the Europeans in the early 16th century to the nations across the world for extorting valuable resources from them. It explains that the idea that the third world countries have been intimately involved in the capitalism system for several centuries.
Both the authors make the attempt of deconstructing the arguments which by far an logical argument that the origin of the third world nations present underdevelopment dates as early as the exploitation by the European Colony (Book This Year 2010).
Both the modernization theory and the dependency theory are similar yet have their own differences. Modernization theory is full of optimism and contradictions. It mentions that it is very important for understanding the history of a particular situation for a realistic approach to solve it. On the other hand dependency theory explores the history of countries and colonization. It directly attacks the issue of structural restraints of the third world, the 16th century European conquest, as well as the intimacy of the capitalism in these third world countries. As per the discussion led by Galeano it provides a clear explanation as how the third world countries became underdeveloped. With a clear picture of history in place it becomes much easier for working on it and correcting the faults so that the third world countries are not affected or exploited anymore.
Similarities between the two theories and the arguments discussed by John Rapley in his book Understanding Development
The book by John Rapley emphasizes on a close link between the development theory and the actual practice of the economic policy making. The entire argument is placed in a manner which is illustrative and would be much appreciated both by the teachers as well as their students. The book tries to unravel the intricacies of developmental practices across the third world countries and mapping out the intellectual roots of it. This is pretty similar to the Modernization theory where they establish the roots of the current economic scenario as the past of every nation. The book not only relates to the concepts of the modernization theory but also is similar to the dependency theory where it provides an assessment of the current state of development theory taking into consideration the impact of involving policies and practices in the developing world (Rienner 2007).
Rapley has tried to trace the evolution of the development theory from the strong statist orientation in accordance with the early post-war period. This has been done through the neoclassical phase till the present emerging consensus on the people centric development. The book discusses the fact of industrialization as a part of development of countries and the possible reasons for the underdeveloped nations to be poor and lack the technological and economic assistance. This could be very well related to the concept of Dependency theory which states that after the roots of countries being economically weak is the exploitation of them by the European colonies for years. Moreover, there is a clear mention of the level of dependency these underdeveloped or developing nations have today on the core countries for their economic and technological development.
While relating it to the modernization theory the book speaks about the stages where countries such as India and China seem to have deployed strategies to pass of being under developed nation to among the fastest developing nations across the world. The cheap labour and costs of production has given them the edge which makes them highly competitive compared to any other nation across the world.
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