International Political Economy Essay Example | Topics and Well Written Essays - 3500 words

International Political Economy - Essay Example(Ttreault and Abel, 1998 p. 3).With reference to the material reality man-to-man actors are expected to be pursuing their self-interest through bargaining and the interplay of the market. (Ttreault and Abel, 1998 p. 3). Similarly considering the ideological reality one would expect to see a multi-faceted bon ton and its potential for improving overall production and wealth skewed in various ways to provide different sorts of short-term advantages for those who can manipulate the organization to conform to specific goals. (Ttreault and Abel, 1998 p. 3). For instance the flow of resources, the availability of money as well as the cost of doing business can be manipulated, even by weak countries if they seize the right moment. While the material reality may be evolving toward a complex interactive system, such an outcome serves to justify and draw one way or another to rig the system to a ill-tempered advantage rather than to structure a mutually beneficial outside(a) economic order likely to raise overall global wealth but unlikely to generate individual distinction or preeminence for particular countries. (Ttreault and Abel, 1998 p. 3).Dependency theory refer to a set of theories, which maintained that third world countries fail to attain adequate and sustainable levels of victimisation as a result of their dependence on the advanced capitalist economies. (Scott and Marshall, 2005). Built upon Lenins theories of imperialism, the theory focused upon the economic penetration of the third world particularly Latin the States by the large capitalist economies. (Lievesley, 2003). Dependency theory was developed in 1960 and called into question the structural developmentalism associated with Raul Presbish as well as the United Nations Economic focussing for Latin America (ECLA), which emerged in 1948 in Santiago, Chile. (Lievesley, 2003). According to the ECLA, the world was regarded as divided into center (the deve loped, industrialized northeasterly) and the periphery (the underdeveloped agricultural South) and the relationship betwixt them was determined by the structure of the world economy. (Lievesley, 2003). The economy of Latin America concentrated on the production of primary inputs for export to the developed industrialized North. Presbish afterward discovered that instead of a mutually advantageous relationship between North and South, there was an unequal exchange with Latin American economies facing a long-term secular decline in their terms of trade thereby resulting in a chronic balance of payment deficits with the periphery having to export more than and more in order to maintain the same levels of manufactured imports. (Lievesley, 2003). The figure in the following page represents the relationship between the developed industrialized North and the underdeveloped agricultural south.Figure 1. Dependency TheoryCore/Metropolitan CentrePowerDevelopmentUnequalExchangePeripheryUnde r developmentMarginal=Dependency Theory Source Lecture Notes.Frank, a German Economist of development was the major contributor to dependency theory who in his apply Capitalism and Underdevelopment in Latin America (1967), concentrated upon the external mechanisms of control exerted by the centre (or metropole) upon the periphery (or satellite). (Lievesley, 2003 Scott and Marshal, 2005). The centre maintained the periphery in a state of underdevelopment for