Chapter 10

Chapter 10 - SOC300 The Political Economy of Third world...

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SOC300 The Political Economy of Third world Development Week 10 3 Overview Using Staniland’s definition of the study of political development, we can see that there is a dynamic relationship between a country’s political system and its economic institutions. This relationship is diverse in nature. Throughout the world, various strategies have been used to stimulate economic development. The third world is no exception. We will be looking at the role of the state in developing policies designed to stimulate economic and industrial growth. For some countries the role of the state is pervasive while in others it is minimal. These will be discussed in detail. Analysis of the Command Economy, Latin American Statism, East Asia’s Developmental State, and the Neoclassical Ideal will illustrate just how diverse economic policies have been in the developing world. There will be discussion of the main industrialization strategies which have been used to stimulate economic growth in Latin America and Asia. We will identify the causes of the recent economic crisis in East and South East Asia. Towards the end of the session there will be discussion of the consequences of development for the environment. In conclusion there will be a brief discussion of democracy and economic development. Please go to slide #4 4 The Role Of The State The role of the state in the economy has been debated by scholars for hundreds of years. Prior to the eighteenth century, in European nations, the state was seen as the source and beneficiary of economic growth.
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This was challenged by the eighteenth century Scottish political economist Adam Smith. He favored capitalism and free market forces. Later, Karl Marx rejected capitalism citing its exploitative qualities. He proposed state ownership of the means of production, at least in the short term. More recently, in the twentieth century, Sir John Maynard Keynes advocated substantial government economic intervention, but rejected the state ownership and centralized planning of Marxism. Certainly, the recent collapse of the majority of communist nations has shown the weaknesses of state controlled ‘command economies.’ Most countries now adopt an approach which comes somewhere between the state controlled ‘command economy,’ and the ‘free market,’ which has no government regulation. Even the most highly capitalistic countries have some government regulation of the economy. This usually involves laws which regulate banking, commerce, international trade, and environmental concerns. Finding the best solution for the developing world is challenging, not least of all due to the diversity of the nations which we have come to recognize over the last nine lessons. Moreover, as noted by dependency theorists, most L-D-C’s are in a vulnerable situation
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This note was uploaded on 09/11/2009 for the course SOC 300 taught by Professor Lewis during the Spring '09 term at Strayer.

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Chapter 10 - SOC300 The Political Economy of Third world...

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