Economic Development and Social Change Essay

1) What is the early-string goal of innovativeisation surmisal in contrast to theories of expectant g all overning body? Comp atomic number 18 and contrast Hoselitz formulation of modernization theory with Lewis theory of uppercase constitutionIn the 18th century, during the Age of Enlightenment, an idea named the Idea of go on emerged whereby its believers were thought of being cap sufficient of developing and changing their societies. This philosophy ab initio appeared through Marquis de Condorcet, who was involved in the origins of the theoretical approach whereby he claimed that technical advancements and frugalalal changes peck enable changes in moral and cultural values. He encouraged technological paradees to help give people yet control over their environments, arguing that technological go on would eventually spur track affectionate carry on. In addition, mile Durkheim positive the concept of breakalism in the sociological field, which emphasizes on th e immenseness of interdependence betwixt the distinct institutions of a f outrankrnity and their interaction in maintaining cultural and br divergently unity. His close to comfortably know work, The Division of Labour in Society, which outlines how order in rescript could be controlled and managed and how primary societies could hold back the transition to to a greater extent scotchally advanced industrial societies.An other(a) reason for the emergence of the modernization theory derived from Adam smiths Wealth of Nations, which represented the widespread practical interest on sparing discipline during a time when in that respect was a continuous singing amongst sparing theory and economic policy that was considered obligatory and obvious. It was by analysing, critiquing, and hence moving out from these assumptions and theories that the modernization theory began to pass water itself. At the time the United States entered its era of globalism and a back do a ttitude characterized its approach, as in the functionalist modernization advanced by B. Hoselitz You club forth the ideal typical features or indices of under emergence from those of education, and the upholdder is your exploitation program. As he also presents in Social Structure and Economic harvest-tide , this body of economic theory abstracted from the immediate policy implications to which it was battlefield and also assumed human motivations and the tender and cultural environment of economic activity as proportionally rigid and unchanging givens(23-24). He claims that the exit lies in the extra examination of what is beyond simply economics scathe and adjustments, by restructuring a social dealings in general, or at least those social relations which are relevant to the performance of the originative and distri only whenive tasks of the society(26).Most forms of evolutionism conceived of discipline as being rude(a) and endogenic, whereas modernization theor y makes room for exogenous influences. Its main aim is to fix some understanding of the functional interrelationship of economic and general social variables describing the transition from an economically under veritable to an advanced society. Modernization theory is unremarkably referred to as a paradigm, and upon closer consideration turns out to be host to a wide variety of projects, some presumably a retentive the lines of endogenous change namely social diametricaliation, rationalization, the spread of universalism, achievement and specificity sequence it has also been associated with projects of exogenous change the spread of capitalist parsimony, industrialization through technological dissemination, westernization, nation building, state formation (as in postcolonial inheritor states). If occasionally this kind in spite of appearance modernization is recognized, still the importance of exogenous influences is considered minor and secondary. I do not view modernizat ion as a single, unified, corporate theory in any strict sense of theory. It was an overarching emplacement concerned with comparative answers of national tuition, which treated development as deuce-dimensional and multicausal along divers(a) axes (economic, political, cultural), and which gave primacy to endogenous rather than exogenous doers. (Tiryakian, 1992 78)In the context of use of Cold War modernization theory operated as a racyly interventionalist tool enabling the put down world to impose its rules and engage in structural imperialism. Typically this reachred in the name of the draw and quarters of endogenous change much(prenominal) as national building, the entrepreneurial temperament and achievement orientation. In ensnare modernization theory was a form of globalization that was presented as endogenous change. Modernization theory, therefore, emerged from these ideas in order to explain the process of modernization within societies. The theory examines not only the internal factors of a rustic precisely also how with the aid of technology and the reformation of veritable cultural structures, conventional countries can develop in the same manner that more developed countries train. In this focusing, the theory attempts to identify the social variables, which bring in to social progress and the development of societies, and seeks to explain the process of social evolution. The question of the functional relations in the midst of all or most culture traits is left open, and finicky attention is given only to those sentiments of social behaviour that cave in implication for economic action, particularly as this action relates to conditions affecting changes in the railroad siding of goods and services achieved by a society(30). They conceptualize the process of development in a similar linear, evolutionary form as old(a) evolutionary theories of progress, but seek to identify the critical factors that initiate and cont rol the development process. These factors, they argue, are both intrinsic and extrinsic the former involves the diffusion of modern technologies and ideas to the developing world, while the latter requires the introduction of topical anesthetic conditions, such as the mobilization of capital, which result foster progress. Modernization theorists believe that primitive cropion, an anachronistic culture, and apathetic personal dispositions combine to maintain an archaic socioeconomic arranging that perpetuates suffering take aims of living. Modernization theorists hold that policies designed to deal with these handed-down impediments to progress primarily through economic intervention, provide the key to prosperity.Overall, Hoselitzs modernization theory is a sociological theory of economic harvest-tide that determines the mechanisms by which thesocial structure of an underdeveloped parsimoniousness was modernized that is, altered to eat on the features of an economically advanced country. Hoselitzs answer was establish on the theory of social deviance that is, that newfound things were started by people who were different from the norm. Unlike Lewis theories that we provide revise later, Hoselitz thought that pocket-sized private economic development was the best way of achieving development in Third realness economies. This particularly involved revaluing what he called entrepreneurial performance, something that Lewis also agrees with, but in a way that provided not only wealth but also social status and politicalinfluence. In Chapter 8 of sociological Aspects of Economic Growth, Hoselitz focuses on the creation of generative cities (that is, cities producing innovations) rather than traditional artless areas were the focal points for the introduction of new ideas and social and economic practices. Many of the early on colonial settlements in the New World and South Africa, Hoselitz claimed, were parasitic, enjoying a certain degree of eco nomic erectth within the city itself and its surrounding surround only at the expense of the rest of the region, which was ruthlessly exploited for its indispensable and verdant resources (p.280).Although prescriptions for inducing social change and removing cultural obstacles to economic modernization in developing countries may be described as social policies, they do not seek to deal directly with mass pauperization and its attendant problems of malnutrition, ill-health, inadequate ho development, illiteracy, and destitution. These critical welfare concerns are seldom referred to by modernization theorists, namely by Hoselitz. Instead, the implicit assumption in his literature is that the process of economic development and social change result heave levels of living and remedy these problems automatically. Since economic growth, engendered by capital investments in modern industry, will expand employment, the proportionality of the population in subsistent poverty will s teadily decline. The increase numbers of workers in the modern rescue will experience a steady rise in real income that will be sufficient not only to satisfy their basic necessitate for food, clothing, and shelter but permit them to purchase consumer commodities as well(p) as social goods such as medical care, education, and social security.Arthur Lewis was superstar of the first economists to create a theory round how industrialized and economically inactive countries are capable of helping undeveloped countries progress. He presented this theory in his work Economic Development with the Un decideed Supplies of Labor where he brings nigh the concept of capital formation. He defines it as the transfer of savings from households and governments to avocation domains, resulting in step-upd output and economic expansion. He claims that his shape says, in payoff, that if absolute supplies of aim are for sale at a continual realwage, and if any part of lolly is reinvest ed in productive capacity, profits will grow continuously relatively to the national income, and capital formation will also grow relatively to the national income(158). From here bridged discharge his development of the both-sector model of the scrimping and the theory of bivalentism. Both posit the foundation of a substantial pool of underutilized labor in a retrospective, subsistent agricultural sector of an economy that perpetuates low levels of output signal and mass poverty. This model comprises two distinct sectors, the capitalistic and the subsistence sectors. The former, which may be private or state-owned, includes primarily manufacturing industry and estate agriculture the latter, mainly small- measure family agriculture and various other types of unorganized economic activity. Here the capital, income and wages per head, the proportion of income saved, and the rate of technological progress are all much higher in the capitalist sector. The subsistence sector is both at a very low level, and also stagnant, with negligible investment and technical progress and no new wants emerging. Institutional arrangements are the nonpareils maintaining this chronic disequilibrium between the sectors, implicit in these differences in real income and productivity. In the extended family the members receive approximately the average product of the group even if the marginal product is much less. The process of development, initiated by an increase in the share of capitalists in the national income, I basically the growth of the capitalist sector at the expense of the subsistence sector, with the goal of the supreme absorption of the latter by the former. To some extent, this is similar to Hoselitzs development of the modernization theory, whereby the claims that the formation of his generative cities (a) creates a new charter for industrial raw materials from the surrounding region, and (b) ties new population to the cities, thereby increasing the de mand for food from the countryside. The net force play of these forces is a widening of economic development over an increasing area affecting a growing proportion of the population outside the city(Hoselitz, 282).However, Lewis theory has several limitations and conditions, most significantly that his theory can be apply only in countries with unlimited supplies of labor. Unlimited supplies of labor arise from the employment ofmore workers than is productively military issueive. Lewis went through all of the areas of Caribbean society where he thought there were pools of turn over in which the marginal productivity was contradict, negligible or zero. His plan now was to make this a potential, industrial labour force. He could take all of the labour away from agriculture, away from casual labour, without lowering the profit margins of the places where they are soon engaged. This was not a radical, disruptive assault on the constituteing economic order, which resulted in unm atchable of the main reasons that his theory was so successful. Ineffective mathematical product, occurring when an additional worker prevented the previous one from producing another product (hence rivaling a negative marginal productivity) was common in the Caribbean, Southeast Asia and other undeveloped regions of the world. some(prenominal) sectors of the economy employ too many people with negligible, zero or negative marginal productivity. According to Lewis these productively unnecessary individuals are employed in agriculture, or are casual workers, petty traders, or women of the household. He claims that the transfer of these peoples work from these areas towards commercial employment is one of the most notable features of economic development. The second source of labor for expanding industries is the increase in the population resulting from the excess of births over deaths. After his analysis of the effect of development on death rate, whereby he concludes that death rates come down with development from some 40 to around 12 per thousand(144), he claims therefore that in any society where the death rate is around 40 per thousand, the effect of economic development will be to bring an increase in the cede of labor(144). From this point of view, he states, there can be in an over-populated economy an enormous expansion of new industries or new employment opportunities without any shortage of unskilled labor(145), though too many people could again cause ineffective production. He clarifies this by saying, Only so much labor should be utilise with capital as will reduce the marginal productivity of labor to zero(145). This can be achieved by offering and maintaining decently high wages. The wages offered should be only slightly higher than the wages available in the subsistence sector, since wages that are too high may attract more workers than needed.But firstly, and perhaps most bigly, entrepreneurial-minded capitalists are required in order to invest in the nation. Tax holidays attract the foreign capitalists. It is not a very difficult task, because they have very good incentives to come. The plantation owner layer in the Caribbean seemed just like the planter class in the American South it had no desire to go industrial and no desire to go private-enterprise(a). It was still trapped in a attitude between an old monopoly system and a commercialize situation since they were able to negotiate for a protected market for sugar, not a competitive market. Lewis hence looked around realized the only way he could accommodate this program of industrialization launched would be by visiting England and America where capitalists and entrepreneurs were palmy and foster their entrance into the Caribbean. Again, he employed the concept of a dual economy where a subsistence sector existed, but also from where he created from impinge on this modern industrial sector to establish on modern capitalism. Capitalists in North Ame rica and Europe found these labouring conditions and prices in the Caribbean quite attractive. Getting this labour to the imported capitalists would not be resisted topical anestheticly because he was taking those labourers with marginal productivity of zero. Once they began working, he would then(prenominal) re-invest more capital into the factory, so that it could expand, employ more workers, export more products, and increase profits, hence developing a self-feeding system that would eventually happen the national income to grow. Although Hoselitz also is of the belief that the formation of a dual economy is beneficial, rather than necessarily attract foreign capitalists through such incentives, Hoselitz believes that the creation of westernized cities led the way forward-moving. He claims that cities modelled after the Western cities exhibited a spirit difference from the traditionalism of the countryside. In this way, he differs slightly from Lewis in that he favored a shi ft in political major power away from traditional leaders and toward total control by economic and urban modernizers in underdeveloped countries, not necessarily foreign entrepreneurial capitalist as Lewis asserts.Lewis knew that some products would work better than others, so he developed an Industrial Programming Market a number of basic calculations about those particular commodities, if matured in the Caribbean, would beparticularly competitive internationally. And so as a result of this study Lewis found that the production of airbrushes, gloves, furniture, needles, shirts, and leather goods would be particularly good to make up, given the skills of the labour force available at the time. For the self-feeding system to be a continuous process, woos of labour had to remain fairly constant. If the cost of labour rose too rapidly, they would not be sustained since the goods would no longer be internationally competitive. The key to this model is indeed international competiti veness. Capitalists can create more capital when the supply of money is higher, and hence if governments create credit, inflation arises yet does not have the same effect as the inflation that arises during depression periods. This inflation only has an effect on the prices in the short-run so that in the long run the final effect equal to what it would be if capital was form by the reinvestment of profit. Lewis discusses at some length the methods by which governments of underdeveloped countries can raise revenue, especially the substantial funds required for government capital formation. For familiar political and administrative reasons much of this revenue has to be embossed from confirmative taxes, notably import and excise duties and export taxes. He argues that indirect taxation is more likely to increase than to return the supply of crusadeThe taxpayer usually does not know how much tax is included in the prices of the articles he buys, so in so far as the determent eff ect of taxation is psychological it can be avoided by using indirect rather than direct taxes If it is an increase in indirect taxation, the effect is probably to increase effort rather than to reduce it (414).Because of the multiple restrictions in this model, it is designed for countries with unlimited supplies of labor and hence this growth has a limit The process must stop when capital accumulation has caught up with population, so there is no longer surplus labor(172). Furthermore, if wages are too high, they may consume the entirety of the profit leading to no re-investment. Several other reasons for the end of capital formation vary the circumstance of indispensable disasters, war or a change of political system can also prevent further economic expansion in a closed economy.Lewis model is powerful but also super restricted and specific to only a handful of nations. Some critics also claim that the distinction between the two sectors is too sharp that small-scale agricultu re is often far from stagnant and the emergence of the production of funds crops by individual producers has in fact been a key tool in economic development since capital formation is actually created in this type of agriculture. Also, this model requires low wages for the labor force, yet very low wages result in a wide rupture between the lower and upper class in a society, an issue that many have questioned thoroughly. Lewis says openly that exploitation can easily occur in this model, but that it is part of capital accumulation. He believes that one has to release a generation to grow the economy, because he assumed that if all goes well and more consumers are attracted to Caribbean, they will generate more business, and the economy will grow to the point where the wealth can be redistributed to the people. He reckoned that it would take, given the rate of growth that he ob aidd in the Caribbean, one generation, thus a period between 40 and 50 years, to grow the economy and claim that poverty could be eradicated in this region. And yet the cost of this would be exploiting this generation, so that their children could earn from it later. Hoselitz, as stated earlier, applied the ideas of Parsons and other sociologists to an analysis of the development process under the assumption, drawn from Adam Smith, that increasing productivity was associated with more detailed social divisions of labor A society on a low level of economic development is, therefore, one in which productivity is low because division of labor is little developed, in which the objectives of economic activity are more commonly the maintenance or strengthening of status relations, which social and geographical mobility is low, and in which the hard cake of custom determines the manner, and often the effects, of economic performance. An economically highly developed society, in contrast, is characterized by a complex division of social labor, a relatively open social structure from which caste barriers are absent and class barriers are surmountable, in which social roles and gains from economic activity are distributed essentially on the basis of achievement, and in which, therefore, innovation, the search for and exploitation of profitable market situations,and the ruthless pursuit of self-interest without regard to the welfare of others is largey sanctioned. (Hoselitz, 1960 60).These anterior theories both provide us with some preliminary indications and developments of views of modern social orders broader than that envisaged in the initial models provided. They stress the historical dimensions of the process of development, emphasizing that this process is not universal, something in the very spirit of humanity or in the natural development of human societies. Instead, the modernization process is full strangulate to a certain period in human history, even though in itself it is continuously developing and changing throughout this period. Development and th e challenges it brings forward constitute a basic given for most contemporary societies. though it certainly is pervasive in the contemporary setting, it is not necessarily permanent in the future, and it would be wrong to assume that once these forces have impinged on any society, they naturally push toward a given, relatively obstinate end-plateau. Rather, as we have seen, they evoke within different societies, in different situations, a variety of responses which depend on the broad sets of internal conditions of these societies, on the structure of the situation of change in which they are caught, and the very nature of the international system and relations, whether those of dependency or of international rivalry. Section 25) Briefly outline David Ricardos theory of comparative advantage then outline in greater detail Samir Amins theory of bang capitalism and why he thinks that trade between the rally and computer circumferential capitalist economies does not meet the co nditions of Ricardos theoryIn 1817, David Ricardo, an incline political economist, contributed theory of comparative advantage in his book Principles of political Economy and Taxation. This theory of comparative advantage, also called comparative cost theory, is regarded as the classical theory of international trade. According to the classical theory of international trade, every country will produce their commodities for the production of which it is most suited in terms of its natural endowments climate quality of soil, pith of transport,capital, etc. It will produce these commodities in excess of its own indispensableness and will exchange the surplus with the imports of goods from other countries for the production of which it is not well suited or which it cannot produce at all. Thus all countries produce and export these commodities in which they have cost advantages and import those commodities in which they have cost disadvantages. Ricardo states that even if a nation ha d an absolute disadvantage in the production of both commodities with respect to the other nation, mutually advantageous trade could still take place. The less efficient nation should specialize in the production and export of the goodness in which its absolute disadvantage is less. This is the commodity in which the nation has a comparative advantage.Ricardo takes into account the following assumptions there are two countries and two commodities there is a perfect competition both in commodity and factor market cost of production is expressed in terms of labor labor is the only factor of production other than natural resources labor is homogeneous i.e. identical in efficiency, in a particular country labor is perfectly roving within a country but perfectly immobile between countries there is free trade production is subject to constant returns to scale there is no technological change trade between two countries takes place on barter system full employment exists in both countrie s there are no transport costs.In 1973, Samir Amin, an Egyptian political economist, begins his dialogue in Unequal Development by referring to Marxs writing on non-European societies, namely India and China, and creates a work in which he reevaluates Peter Evans theory of Dependent Development and simultaneously presents his theory of marginal capitalism in developing societies. He shows how these early ideas established the conception of the centre and the outer boundary, and how the development of capitalism in the periphery was to remain extraverted, based on the external market, and could therefore not lead to a full flowering of the capitalist mode of production in the periphery(199). He then begins to develop his own theory of the transition to fringy capitalist economy by questioning David Ricardos assumptions in his theory of comparative advantage, and later outlines nine theses tosupport his views. Peripheral capitalism is based on, but not identical to, the imperiali sticic relationships developed between colonizing nations and their colonies. In this economic relationship, the players are the same the colonizing nation becomes the center, while the colony becomes the periphery but the role that each society plays is different from the classic imperialist relationship. The encircling(prenominal) device economy is mark by extreme dependence on external demand, or extroversion, as well as stunted and mismatchedised rates of development within the society. Amin maintains that in order for these societies to break free of extroversion and develop, they must be actively removed from the encircling(prenominal) capitalist relationship. He proposes nationalization and socialization as an alternative, a system which-when contrasted with peripheral capitalism-could not be a more different approach to economic development. Unfortunately for the developing nations, socialism was largely unsuccessful as an economic experiment, consistently causing st agnation and underdevelopment in societies that attempted it.Peripheral capitalism evolves from colonial imperialism, an economic system in which the colonizing nation penetrates deep into the effect of the colonial economy in an effort to manipulate it towards the benefit of the drive country. Every aspect of the colonial economy is geared not towards the expansion of the colonial economy itself, but rather towards the production of something that the colonizing nation cannot produce itself. As a result, the success and the existence of a particular sector of the colonial economy is dependent upon whether or not the mother country has a need for that sector colonial economies are rooted heavy in external demand. This extroversion leaves the colonial economy without an indigenous set of linkages, as economic sectors that will benefit from colonial activity function mostly within the economy of the colonizing nation. When autocentric, or internally-driven, economic growth is barr icade in such a way that a peripheral economy emerges with the same sort of external dependence on the central economy that was suffered by the colonial economy.The peripheral economy is typically plagued by an unequal division of labor, or forte, between itself and the central economy. While the latterenjoys the benefits and progress associated with industrialization, the periphery tends to remain predominantly agricultural. What little industry may exist in the peripheral economy is most often light industrial production of small, transparent goods, as opposed to the heavy industrial production of machinery and complex products that characterizes the central economy. Additionally, Amin argues that there is often a hypertrophy of the ordinal sector(200) of the peripheral economy too much of the economy is habituated to providing services, expressed especially in the excessive growth of administrative expenditure(201) effectively anchoring the societys development due to a esc ape of productive advancement.Yet another malady of the peripheral economy is the trim value of the local multiplier factor factor effect, another result of the remnants of economic infrastructure modification from the colonial period. If an economy is replete with linkage sectors, then any money put into the leading sector will generate a multiplied effect in all of the forward and backward linkages of that industry. Peripheral economies, however, are effectively stripped of linkages during their colonial phase of development hence spending in the peripheral economy ultimately benefits the central economy, where most of the peripheral industries linkages are realized. Not only is the local multiplier effect reduced in the peripheral economy, but Amin claims that it also leads to the marked propensity to import(201), and thus is in effect transferred to the central economy, where revenue is collected every time money is spent in the periphery. Because peripheral input ultimately goes abroad, local businesses are not stimulated, as they would be if linkages were realized within the periphery, worsening the already-detrimental conditions of the peripheral economy. Adding to the lack of stimulation of local business is the fact that peripheral industries tend to be dominated by monopolies established from foreign capital. After the majority of revenue goes to the central economy through linkage industries, what little money remains in the local economy is often put into businesses controlled by central capitalists. In other words, almost every dollar put into the periphery ultimately finds its way to the central economy.In Unequal Development, Amin maintains that no economy can be expected todevelop without successfully making the transition from extrovert to invaginate so that it can assert the dominance of the exporting sector over the economic structure as a whole(203), and that no peripheral capitalist economy can independently heal the economic wounds in flicted by colonialism. Therefore, the only way to promote development in peripheral capitalist economies is to actively remove them from their disadvantageous relationship with the central economy, which, according to Amin, should be replaced by internal nationalization and socialization of the once-peripheral economy. The establishment of a jingoistic socialist state would serve both to eliminate external dependence, as well as to reconcile the disarticulated nature of the local economy.The first refresh of Ricardos theory made by Amin is its lack of specificity claiming that his examples of trade between Portugal and England were very exclusive to intra-European trade and could not exactly be applied to relations between several different country relations around the World. If there is a large difference in GDP between two countries, then what statistics demonstrate is that the country with the smaller GDP would benefit more from this transaction, and this was the source of sp ecial problems that dictated development policies in the periphery that were different from those on which development of the West was based(201) a factor that Ricardo hadnt considered it in his theory. Another live yet neglected consideration was the importance of the commodity in terms of a nations GDP wine was a big section of the Lusitanian GDP, greater than it was for England, so the trade benefited the Portuguese to a greater extent than it did to the British.He elaborates upon this idea by explaining how the relation between central and periphery assumes the mobility of capital, since the centre is investing greatly in the periphery. What the periphery chooses to specialize in is to a large extent contumacious by the centre, since very often the selection comes after it has been forced to serve the imperial country. As he clearly states, this type of trade compels the periphery to confine itself to the role of complementary supplier of products for the production of which it possesses a natural advantage exotic agricultural produce andminerals(200). The result is a decrease in the level of wages in the periphery for the same level of productivity than at the centre, hence limiting the development of industries focused on the home market of the periphery. The disarticulation due to the adjustment of the orientation of production in the periphery to the needs of the centre prevents the transmission of the benefits of economic progress from the poles of development to the economy as a whole. Overall, this is what Amin defines by unequal specialization, which in turn violates the conditions of Ricardos theory. Another argument that Amin makes involved the Keynesian multiplier effect. He claims that this effect does not take place to the situation at the centre because of its advantaged stage of monopoly, characterized by difficulties in producing surplus. Due to this unequal specialization as well as the significant propensity to import that follows, the effect is a transferring of multiplier effect mechanisms and the accelerator theorem from the periphery to the centre.Furthermore, Amin includes the social aspect of this process, which is a result of the individual history of each nation and the power imbalance created. Amin finds that the nature of the pre-capitalist formations that took place previously and the epoch in which they became integrate in the capitalist system are both very important factors in determining the presence or lack of development to come. He also draws a line between two different terms, peripheral formations and young central formations, whereby the latter, based on the predominance of a simple commodity mode of production, are capable of independently evolving towards a fully developed capitalist mode of production. Amin terminates by asserting the domination by central capital over the system as a whole, and the vital mechanisms of primitive accumulation for its benefit which express this domination, subject the development of peripheral national capitalism to strict limitations(202).These countries would hence not gain equal benefits under this trade, only if the patterns of specialization were undertaken in more ideal conditions, conditions that approximated Ricardos theory more closely. Rather than being a positive force for development, this type of trade becomes a forcecreated under development. It will contribute to development in the centre, and underdevelopment in the periphery. He concludes that this inevitably hinders the development of peripheral nations the impossibility, whatever the level of production per head that may be obtained, of exhalation over to auto centric and auto dynamic growth(202).