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I. SOCIAL CONTEXT Dependency theory originates with two papers published in 1949 – one by Hans Singer and Raul Prebish It became popular in 1960’s and 1970’s as criticism to modernization theory Developed in Latin America Popularized by Andre Gunder Frank Han Singer is a German Jew. (29 November 1910 – 26 February 2006)He was a student of John Maynard Keynes in Cambridge University.In 1947, he was one of the first three economists to join the new Economics Department of the United Nations, in which he remained for the next two decades. During his time at the United Nations, Singer was the Director of the Economic Division of the United Nations Industrial Development Organization (UNIDO), Director of the United Nations Research Institute for Social Development (UNRISD), and was closely involved in the creation of the Bretton Woods Framework and the post-World War II international financial institutions. The fundamental claim of the hypothesis is that, in a world system in which poorer nations specialize in primary products such as raw minerals and agricultural products that are then shipped to industrialized nations that, in turn, make advanced products to be sold to poorer nations, all of the benefits of international trade will go to the wealthy nations. Raúl Prebisch (April 17, 1901 – April 29, 1986) was an Argentine economist known for his contribution to structuralist economics, in particular the Singer–Prebisch thesis that formed the basis of economic dependency theory As a young man his writing was marked by a complete adherence to the idea of free-trade but in the 1930s, as a result of the Great Depression he "converted" to protectionism. His previous beliefs had been supported by the spectacular economic growth of Argentina from the 1860s to 1920s as the country exported a large amount of beef and wheat to the United Kingdom. However, by the 1930s the Great Depression and the growing economic dominance of the United States, which exported beef and wheat rather than buying them, had significantly hurt the Argentinian economy. Prebisch and his colleagues were troubled by the fact that economic growth in the advanced industrialized countries did not necessarily lead to growth in the poorer countries. Indeed, their studies suggested that economic activity in the richer countries often led to serious economic problems in the poorer countries. Such a possibility was not predicted by neoclassical theory, which had assumed that economic growth was beneficial to all (Pareto optimal) even if the benefits were not always equally shared. As a result of this deduction Singer was a passionate advocate for increased foreign aid in a variety of forms to the developing world to offset the disproportionate gain to developed nations of trade. He attempted to create a 'soft-loan' fund, which would offer loans at interest rates below market rates to be administered by the United Nations, but was systematically blocked by the United States and the United Kingdom, who wished to retain control of money flowing out of the UN. The thesis begins with the observation that in the present world system the periphery produces primary goods to export to the center, and the centre produces secondary goods for export to the periphery. According to the thesis, as technology improves, the centre is able to retain the savings made, since it can retain higher wages and profits through developed unions and commercial institutions. At the periphery, companies and workers are weaker, and have to pass on technical savings to their customers in the form of lower prices. Prebisch pointed to the decline in the terms of trade between industrialised and non-industrialised countries, which meant peripheral nations had to export more to get the same value of industrial exports. Through this system, all of the benefits of technology and international trade would accrue to the centre. Andre Gunder Frank (February 24, 1929 – April 23, 2005) was a German-American economic historian and sociologist who promoteddependency theory after 1970 and world-systems theory after 1984. He employed some Marxian concepts on political economy, but rejected Marx's stages of history, and economic history generally. Frank was born in Germany, but his family fled the country when Adolf Hitler was elected Chancellor. Frank received schooling in several places in Switzerland, where his family settled, until they emigrated to the United States in 1941. Frank's undergraduate studies were at Swarthmore College. He earned his Ph.D. in economics in 1957 at the University of Chicago. His doctorate was a study of Soviet agriculture entitled Growth and Productivity in Ukrainian Agriculture from 1928 to 1955. Ironically, his dissertation supervisor was Milton Friedman, a man whoselaissez faire approach to economics Frank would later harshly criticize. Throughout the 1950s and early 1960s Frank taught at American universities. In 1962 he moved to Latin America, inaugurating a remarkable period of travel that confirmed his peripatetic tendencies. His most notable work during this time was his stint as Professor of Sociology and Economics at the University of Chile, where he was involved in reforms under the government of Salvador Allende. After Allende's government was toppled by a coup d'état in 1973, Frank fled to Europe, where he occupied a series of university positions. In 1994 he retired as emeritus professor at the University of Amsterdam.  Perhaps his most notable work is Capitalism and Underdevelopment in Latin America. Published in 1967, it was one of the formative texts in dependency theory. In his later career he produced works such as ReOrient: Global Economy in the Asian Age and, with Barry Gills, The World System: Five Hundred Years or Five Thousand. Frank's theories center on the idea that a nation's economic strength, largely determined by historical circumstances—especially geography—dictates its global power. He is also well known for suggesting that purely export oriented solutions to development create imbalances detrimental to poor countries.

I. SOCIAL CONTEXT Latin America In the 1950s the United States became the leading source of foreign investment in Latin America. U.S. companies extended some operations into Latin America, and Latin American governments were requiring U.S. companies to have a certain percentage of local people as their employees and to pay taxes that amounted to more than 50 percent of the company's net profits. United Fruit and most U.S. oil companies were among those paying such taxes: 66 percent of their net profits. By 1962, however, per capita economic growth had declined to zero. And in the 1960s people were pondering why Latin America, with its vast natural resources, was so much poorer than the more advanced industrialized countries. During the 1960s, Latin America's average per capita economic growth rate was at 2.8 percent per year. There were complaints that Latin American agriculture was oriented too much for sales abroad rather than food for the people of Latin America – sales that benefited Latin America's rich, seen as in league with the foreign capitalists and imperialists. The foremost problem for Latin America was, indeed, people not having enough food to eat. But the production of food being consumed in Latin America was increasing – not by moving onto land that had been used for export crops but by higher yields on existing lands. This was mainly in the production of rice and beans – two of Latin America's major foods. The smaller, moderate sized farms growing these foods were adopting advanced farming practices. Latin Americans were buying machinery and consumer goods from abroad – 40 percent of it from the United States. And Latin America was benefiting from demand for its products: coffee, timber, tin, beef, sugar, copper, nitrates, oil and other minerals. But trouble loomed, and there was to be no great Great Leap Forward economically, in Cuba or elsewhere. Latin America's population was growing from nearly 200 million in 1960, to reach 484 million in 2000. And other problems that Latin America had been living with continued – different in different countries, each with its own characteristics and imperfect management. The recurring theme of extraction of goods from a periphery (i.e. Latin America) to an industrialized core began with European colonization, though the US has now taken on a majority of that role. This position was secured through the migration of US corporations to Latin American countries where both the labor and the resources were cheap. Though it is true that they provided jobs for the masses, they did so at the expense of their workers. Latin America, without any refinement infrastructure to produce finished goods, continues to export mass amounts of raw materials and ship them off to developed nations (Bodenheimer). Eventually through trade, Latin America buys the goods made by the developed countries at a higher amount than their profit from selling the raw materials. This mechanism between core and periphery increases their disparity, thus preventing Latin America from establishing an equal economic platform. To put it simply, the industrialized core is playing an unfair game in the international market.

II. DEFINITION DEPENDENCE- is a conditioning situation in which the economics of one group of countries are conditioned by the development and expansion of others. In other words, capitalist penetration of the societies of the poor ones, especially the Third World, was the principal cause of underdevelopment

II. DEFINITION The Metropolis-satellite linkage Internal structure of dependence Monopolies Cultural Dependence CORE Labor intensive production Raw materials The industrial countries whic are usually metropoles, rely upon the periphery satellite countries for their raw materials and other production needs. Their products are marketed at the satellite or the periphery. In the process, they eran more profits and benefits. At the bottom end are the satellite or the periphery. They depend upon the metropoles for their survival, especially for technology and financial aid. This dependency makes the satellite always at the mercy of the policies and norm of the metropoles. It even creates the norm that periphery countries should kowtow the development pattern of the metropoles, which is to industrialize. Metropoles-satellite linkage- interpendence between the economies becomes dominant-dependent relationship. What the metropolis really brings to and at the same time gets out from the satellite countries is the surplus (actual potential excess of social production over consumption) With the surplus, the metropolis takes advantage economicaly, while robbing the satellite the opportumity to create more wealth and gain Internal Structure of dependence-Dependence is also a situation within the structure of the developed nation, characterized by its own system of center-periphery linkages. A dependent nation has its own develop sector responsible for extracting the locally generated surplus from the primary producers Monopolies- The important aspect of internal economic structure that assures the continuous control of the world capitalist system is the monopolies. With its existence, commodity prices are controlled resulting to the control of resources of foreign currencies of dependent nations. This further results to a firm control on the nation’s internal market, enabling easy maintenance of underdeveloped production. Cultural dependence- it is characterized by delusion of the local population by the massive presence of the culture of the advanced capitalist nations leading to cultural “inferiority complex”. The local culture is downgraded through the use of foreign evaluative standards. Imperialism also employs a sector of the intelligentsia to function as technocrats enticing them with scholarships and educating them. Periphery

II. DEFINITION 1. International Division of Labour 2. Class Distinction CC PC 3. Global Capitalism CP PP Assembly of different theories- Neo marxist, historical structural theory, world system theory Dependency theory argues that: There are number of diffferent kind of states that perform different functions in the world economy Center of the center-richest and most powerful countries, examples are US, UK, France and so on Periphery of the center-modern industrialized wealthy countries like Canada, Netherlands. They have little global power than center countries but quite rich Center of the Periphery-still developing with fair amount of wealth, South Africa, Brazil and India Periphery of the periphery-poorest countries like Cambodia, El Salvador, Zambia The first agrument of the theory is that there is an international division of labor between these countries, core countries dominate in terms of industry and technology, they have the reearch, technology and capital intensive industries Those are in periphery are characterized by cheap labor, resources extraction economy, agricultural production Periphery of the center served the rich countries, center of the periphery served both countries while periphery of periphery served everybody else 2nd argument is that theres is a class distinction. Each of each different type of countries have clear divide between the rich and the poor, whic are same in different countries, These rich people also cooperate with one another to ensure that they stay in power and increase their own wealth so they collaborate to keep the system the way it is 3rd argument all of the structures exist in wider global system,which is characterized by global capitalism. In this system, liberal economic theory dominates which are theories of trade and theories finance which of course served he interest of the wealthy countries Multinational corporations and bank are instruments of the wealthy and International instutions like IMF WB served the interest of the richest and powerful people. The global media and educational system also served the interest of the wealthy global media They all served the interest of the wealthy countries. They did not promote development and equal opportunity but dominance and exploitation. The system prevent the countries from developing which they called underdevelopment. Thus we do not see countries developing as the way the traditional economic describes. Dependency theory has lot to tell us why there are so much poverty and equality on the world economy.

III. CRITIQUE/ANALYSIS STRENGTHS: It emphasizes the external barrier to development Development theory is descriptive but also prescriptive and still relevant at the curent period It is holistic that it highlights the economic aspect of development but in deeper analysis it also look into the political and cultural structure of “underdevelopment”

III. CRITIQUE/ANALYSIS WEAKNESSES: Not clear on describing on how to restructure or who would do the restructuring of the society Not possible to delink countries totally from world capitalist system The developmentalists in Latin America are ignoring a very basic premise: any real attempt of development must focus on the rupture of the old colonial legacy. Otherwise, social change will purely constitute a perpetuation of actual unequal conditions.

III. CRITIQUE/ANALYSIS CURRENT PHILIPPINE SETTING In the Philippines, those that control technology are foreign entrepreneurs. Subservient state Cultural-dependency Dependent intelligentsia Import-dependent and export oriented economy Exporter of cheap labor Consumer goods such as foodstuffs, groceries canned goods etc. are mostly imported; however, it is noticeable that they are assembled or repacked in the Philippines but under license from foreign corporations, or affiliates or subsidiaries of foreign counterparts Subservient state- closely allied with metropolis-sponsored bourgeoisie; promulgates necessary laws and procedures that ensures surplus exportation; provides necessary legitimacy for transnational to come in. Those in government usually are stockholders of companies, come election time the business community almost always determines who win. Cultural dependency-people are deluded with a massive presence of the culture of the advanced capitalist world; mass media, arts and fashions of the first worlds. Dependent intelligentsia- use of foreign foundations to dole out scholarships to graduate students to study in the metropoles conutry’s center; scholars come home as technocrats are recruited into government service The Americans largely own most of our technology. This is a historical reality that started during their colonial rule in the Philippines. We manufacture for international market. We produce not for our people but for foreigners

REFERENCES http://www.docstoc.com/docs/96621141/International-Development https://www.mtholyoke.edu/acad/intrel/depend.htm Tools of Analysis and Analytical Framework by Oscar Ferrer http://www.politicalaffairs.net/colonialism-and-underdevelopment-in-latin-america/ http://www.fsmitha.com/h2/ch24v.html Theories of Development, Richard Peet and Elaine Hartwick, 2009 http://en.wikipedia.org/wiki/Hans_Singer http://en.wikipedia.org/wiki/Raul_Prebisch http://en.wikipedia.org/wiki/Andre_Gunder_Frank http://hist140.wikia.com/wiki/Dependency_Theory