Outline for 12/3: The North-South Gap II
Imperialism
Decolonization
World Systems Theory
Dependencia
NIEO
“bad” institutions
Start where we left off: the North-South Gap over Time
Why a Growing North-South Gap through at least the 1970s?
1. North starts out with a geographic advantage
Temperates (N) vs. tropics (S)
More compact economic geographies in N
Why a Growing North-South Gap through at least the 1970s?
2. Exploitation of the Global South: imperialism beginning circa 1500
How might being a colony hurt economic development?
British Empire
French Empire
Spanish Empire
Portuguese Empire
Dutch Empire
Belgian Empire
But with rapid decolonization after WWII, shouldn’t the N-S Gap begin to decline in the
1950s?
World Systems Theory
Core (N)
Periphery (S)
Policy recommendations from World Systems Theory?
Dependencia
International economy is not one of interdependence (per institutionalism and free
trade theory)
Instead, the capitalist international economy is characterized by 3rd World dependence.
Trade
FDI
Foreign debt
Policy recommendations from Dependency Theory?
New International Economic Order (NIEO)
Proposals put forth beginning in 1960s (often in UNGA)
Southern countries should be able to:
Regulate MNCs and their FDI activities
Establish producer cartels
Protect their domestic markets
Northern countries should provide more foreign aid
New trade institution (as alternative to GATT): UNCTAD
Successful?
“Bad” institutions
Many developing countries have bad political institutions:
weak governments who cannot enforce law /order or guarantee property rights
strong and corrupt governments who over-tax and over-manage their economies
Bad institutions slow economic growth
How linked to colonialism/decolonization?
Exceptions?
Good governments/institutions in the South?
Policy recommendations based on this argument?