Fernando Cardoso and Ernesto Faletto, Dependency and Development in Latin America (1979)

Preface to the English Edition

* “We seek a global and dynamic understanding of social structures  instead of looking only at specific dimensions of the social process.” (ix)

* attempt to analyze domination in its connection with economic expansion (ix)

* Their method is dialectical, historical-structral (to be exact)

* The dialectical approach should bring to the surface both the mechanisms of systemic self-perpetuation and the possibilities for change. (xi)

* The authors focus on two dependency situations -> dependency where the productive system was nationally controlled, and dependency in enclave situations (xviii)

 

  1. Introduction

* Industrialization was seen as a required next step of economic growth for developing nations (2) (this is WWII era)

* given the context, 2 economic goals seemed obvious:

1) abosorption of technology to diversify the structure of output and to increase productivity (3)

2) definition by the state of investment policies that would create the infrastructure needed for that diversification (3)

 

  1. Comprehensive Analysis of Development

* Development is a social process (8)

 

Traditional and Modern Societies

* The argument is that Latin American societies belong to a structural type called ‘traditional’ and they must give way to a new type called ‘modern’ (8)

* These categories are not exhaustive enough, nor are they specific enough. Also, they do not take into account different economic stages (9)

* “Analyses that relate develoipment to modern society and underdevelopment to traditional society are too simple. Development and modernization are not necessarily related just because domination in developed societies excludes ‘traditional groups.’” (10)

 

Social Change: External Models, Demonstration Effect, and Specific Situations

* Assumption that the West has taken the ‘right’ path and is predictive of how the rest must develop (11) [The development process]

* Demonstration effect: assumption that the economy will be modernized through consumption and that ultimately modernization alters the production system in such a way that it may deviate from the ‘stages’ of industrialization characteristic of advanced countries (12) It is the modernization of consumption patterns, implying some degree of income improvement for urban populations

 

Structure and Process: Reciprocal Determination

* Development must be seen through the lens of ‘historic specificities’ – economic and social – underlying the development proceeses at the national and international levels (13)

* The need to link economic and social components of development in an analysis of the behavior of social groups.  This is done by recognizing that every economic link is a social link, and that these links are processes (with struggle inherent in them) (13-14)

* “Development results therefore from the interaction and struggles of social groups and classes that have specific ways of relating to each other. The social and political structure is modified insofar as new social classes and groups succeed in imposing their interests on or accomodating them to previous dominant classes in society” (14)

* How so we determine what forms the structures of dominationawill adopt? For it is through these structures that the dynamics of class relations may be understood. (14)

* The focus of their analysis will be on the internal manifestations of dependence (15)

 

Underdevelopment, Periphery and Dependence

* Underdeveloped countries must be distinguished from those who have no development (16)

* “there exists among the developed and underdeveloped economies a difference, not only of the stage or the state of the production system, but also of function or position within the international economic structure of production and distribution: some produce industrial goods; others, raw material.” (17)

* Distinction b/w ‘central’ and ‘peripheral’ economies has greater social significance than b/w developed and underdeveloped (18) These ideas stress the functions that the underdeveloped countries perform in the world market, but overlook the socio-political factors involved in the situation of dependence. Thus, we cannot replace our analysis with these terms

* There is a distinction between production capability and autonomous decision-making centers (18)

* Thus the need for historical explanation of how a country arrived at a particular economic position

* “If it is accepted that market influences by themselves neither explain development nor guarantee its continuity or direction, then the behaviour of social groups and institutions becomes crucial to the analysis of development.” (21)

 

“National Underdevelopment”

* Defined, it is “a situation of objective economic subordination to outside nations and enterprises and, at the same time, of partial political attmepts to cope with ‘national interests’ through the state and social movements that try to preserve political autonomy.” (21)

* One aim of comprehensive analysis is to determine the links between social groups that in their behaviour actually tie together the economic and political spheres.’ (21)

* “Dependence should no longer be considered an ‘external variable’; its analysis should be based on the relations between the different social classes within the dependent nations themselves.” (22)

* Assumption of the need for peripheral economjies to repeat the evolution of the economies of the central countries in order to develop (23) But the development of the centre relied on a specific and unequal economic engagement with the periphery

* The developing countries are not following the history of the developed countries – their historical conditions are different. Development today must occur when the market already exists, and is divided between capitalist and socialist worlds (24) This is much different than the establishment of world markets by the bourgoisie.

 

Types of Linkage Between the National Economies and the Market

 

Towards a Comprehensive Analysis of Development

* “In developing but dependent countries, social structures reflect the double edge of the economic system: its external links and internal roots.” (26)

* “The social and economic transformations that alter the internal and external aspects of the underdeveloped and dependent socieities are actually political processes that, in present historical conditions, do not always favor national development.” (28)

  1. The Period of “Outward Expansion”

 

  1. Development and Social Change: The Political Role of the Middle Class

 

  1. Nationalism and Populism: Social and Political Forces of Development in the Phase of Consolidating the Domestic Market

 

  1. The Internalization of the Market: The New Nature of Dependence

* The very structure of the production system, as well as the character of state and civil society, was reorganized to give way to a capitalist industrial system which could be developed both on the periphery of the world market and as an integral part of it.” (150)

 

The Structural Limits on the Process of National Industrialization

* “this interpretation proposes that there are necessary structural limitations on a nationally controlled industrial development within which the various social forces operate” (154)

* “Structurally, indistrialization in Latin America requires vast accumulation, and in turn, produces marked social differentiation.” (154)

* “the downward trend in the terms of trade is an additional limitation on the structural possibility of development” (155)

** It seems that Cardoso is speaking in terms of ‘space’ for development (cf. Foucault on the concept of space, Archeaology of Knowledge) Thus, space can be available in some contexts, but not others – can apply broadly or narrowly, etc.  Context is crucial

* Basically, attempts to maintain the rate of industrialization cannot succed without profound political-structural changes. (157)

 

The Opening of Domestic Markets to External Control

* At the same time (1950s), foreign industrial capital was searching for new markets (157)

* Two kinds of investments:

**1) taking advantage of an existing market – competing with internal interests

**2) those situations which assured the investor virtual control of an expanding market (158)

 

Dependence and Development

* The integration into the world market of the industrial-perhieral economies was different from that of the agro-export economies. The same was true of the political expression of this integration (159)

* A development pattern was chosen that depended on increasing amounts of foreign investment in the industrial sector (160) This kind of development situation engenders specific relations between internal growth and external ties.

* “Most similarities between the dependence situation of the industrialized peripheal economies and that of the enclave economies are superficial.” (161)

* Industrialized nations (where the puiblic sector participates in economic regulation and formation of new capital) can attain a greater measure of autonomy of internal decision (163)

 

 

7. Conclusions’