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Economic dependency in black Africa: an analysis of competing theories

Published online by Cambridge University Press:  22 May 2009

Patrick J. McGowan  and
Dale L. Smith
Patrick J. McGowan
Affiliation:
Patrick J. McGowan is an Associate Professor of International Relations at the University of Southern California. The senior author gratefully acknowledges the comments on an earlier draft by the faculty members of the USC Colloquium on Interdependence/Dependence and by Professors Ann Seidman, Monique Garrity, Timothy Shaw, Christopher Chase-Dunn, Sanjaya Lall, and James Caporaso.
Dale L. Smith
Affiliation:
Dale L. Smith, B.A. (USC), is a Political Science graduate student at Massachusetts Institute of Technology. The senior author gratefully acknowledges the comments on an earlier draft by the faculty members of the USC Colloquium on Interdependence/Dependence and by Professors Ann Seidman, Monique Garrity, Timothy Shaw, Christopher Chase-Dunn, Sanjaya Lall, and James Caporaso.
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Extract

Current attempts to understand and remedy the underdevelopment and peripheral international roles of Third World states derive from three competing paradigms: conventional social science, Marxism, and dependency theory. Each paradigm claims to explain past history and to make relevant policy recommendations for Third World leaders. Yet, none of these approaches has so far been formulated as complex, well specified, causal models. One can build theory relevant to data by specifying competing three-variable models relating economic dependency to economic performance and development potential. An empirical evaluation can then be made of the dependency theory proposition that economic dependency inhibits positive economic performance (growth and development). Partial correlation and regression analyses of economic data from thirty tropical African states in the middle and late 1960s provide little support for two dependency-based models and evidence in favor of conventional and Marxist models. These findings have implications for theory, further research, and policy.

Type
Part II
Information
International Organization , Volume 32 , Issue 1 , Winter 1978 , pp. 179 - 235
Copyright
Copyright © The IO Foundation 1978

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References

1 The concept of “control” as used here has been discussed in Rosenau, James N., “Calculated Control as a Unifying Concept in the Study of International Politics and Foreign Policy,” pp. 197–237Google Scholar in Rosenau's, The Scientific Study of Foreign Policy (New York: The Free Press, 1971)Google Scholar and in McDonald, Neil A., Politics: A Study of Control Behavior (New Brunswick: Rutgers University Press, 1965).Google Scholar

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5 In this context, “worldwide” means that the system of economic relations was spatially larger than any single political unit, unlike the political economies of world empires such as Rome. Wallerstein, Immanuel, The Modern World System: Capitalist Agriculture and the Origins of the European World Economy in the Sixteenth Century (New York: Academic Press, 1974).Google Scholar

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8 This figure is a slightly modified version of one presented by Professor Ann Seidman in a panel on “Discussion on Dependence,” November 5, 1976, at the Annual Meeting of the African Studies Association, Boston.

9 As described for the case of US penetration of Latin America and Africa in: Covert Action in Chile, 1963–1973, Staff Report of the Select Committee to Study Governmental Operations with Respect to Intelligence Activities, US Senate, 94th Congress, 1st. Session, December 18, 1975 (Washington: G. P. O., 1975); Lowenthal, Abraham F., “The United States and Latin America: Ending the Hegemonic Presumption,” Foreign Affairs 55 (October 1976): 199–213Google Scholar; Schechter, Daniel, “Un nouveau champ d'action pour les Etats-Unis,” he Monde Diplomatique, No. 262 (01 1976): 15–17Google Scholar; Lake, Anthony, The ‘Tar Baby’ Option: American Policy Toward Southern Africa (New York: Columbia University Press, 1976)Google Scholar; Oudes, Bruce, “The CIA in Africa,” Africa Report (07–08 1974)Google Scholar; and Lemarchand, Rene, “The CIA in Africa: how central? how intelligent?” Journal of Modern African Studies 14 (09 1976): 401–26.Google Scholar

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11 Ibid.

12 Compare, for example, the points of view found in Holt, R. and Turner, J., The Political Bases of Economic Development (Princeton, N.J.: Van Nostrand, 1966)Google Scholar; Tilly, Charles, ed., The Formation of National States in Western Europe (Princeton, N.J.: Princeton University Press, 1975)Google Scholar; and Wallerstein, The Modern World System.

13 There is, of course, considerable variety among “dependency” theorists and there is thus no orthodoxy among them. The impact of their work is cumulative rather than doctrinal. Our bibliography of dependency theorists runs to over one hundred citations. Representative general statements are: Barrat-Brown, M., Essays on Imperialism (1972)Google Scholar; Amin, S., he developpment inegal (Paris: Minuit, 1973)Google Scholar; Santos, T. Dos, Underdevelopment and Development (Harmonsworfh: Penguin Books, 1973)Google Scholar; Santos, T. Dos, “The structure of dependence,” American Economic Review, 60 (05 1970): 231–36Google Scholar; Emmanuel, A., Unequal Exchange (New York: Monthly Review Press, 1969)Google Scholar; Furtado, C., Development and Underdevelopment (Berkeley: University of California Press, 1967)Google Scholar; Frank, A.G., “The development of underdevelopment,” Monthly Review, Vol. 18, No. 4 (09 1966): 17–31Google Scholar; Myrdal, G., Economic Theory and Under-developed Regions (London: Duckworth, 1957).Google Scholar For specific references to Latin America and Africa, see the bibliographies of the papers cited in the next section.

14 Foster-Carter, Aidan, “From Rostow to Gunder Frank: Conflicting paradigms in the analysis of underdevelopment,” World Development 4 (03 1976): 167–80.CrossRefGoogle Scholar

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18 From a personal communication by Professor Caporaso to the senior author, September 27, 1976.

19 Dependency theories claim to explain whole centuries of the history of Third World countries, and studies based on post World War II data such as ours cannot claim to “test” this historical dimension. On the other hand, these theories also contain short- to medium-term policy prescriptions, such as the nationalization of financial institutions—banks and insurance companies. The effects of such actions are not predicted to take centuries to appear. Therefore, as long as conventional, Marxist, and dependency theories continue to recommend public policies, they are open to empirical evaluations such as ours.

20 Jackman, Robert W., Politics and Social Inequality: A Comparative Analysis (New York: Wiley, 1975),Google Scholar particularly pp. 4–9 and 203–08. Our thanks to Professor Carol Thompson for bringing this book to our attention.

21 It is true that scholars working within different paradigms such as the conventional, Marxist, and dependency approaches often talk past one another because they use different vocabulary and concepts, e.g., “modernization” and “need to achieve” vs. “mode of production” and “imperialism” vs. “unequal exchange” and “departicipation.” See Aidan Foster-Carter. It is also true that each approach can be subjected to an ideological critique that explicates the social, cultural, and political factors that account for why an individual or group of scholars works within a particular paradigm, e.g., most Western scholars do conventional economics and political science because they are bourgeois intellectuals in bourgeois societies and most East European scholars do Marxist studies for equally obvious reasons. See Tipps, Dean C., “Modernization theory and the comparative study of societies: a critical perspective,” pp. 62–88Google Scholar in Black, C.E., ed., Comparative Modernization: A Reader (New York: Free Press, 1976).Google Scholar The first problem makes cross-paradigm research difficult, particularly in the areas of concept definition and operationalization, but not impossible. Moreover, as Tipps correctly notes, neither the first nor the second criticism says anything at all about the truth content of the competing theories. Only rigorous empirical research of a case study, comparative, and statistical sort can address the explanatory and predictive adequacy of competing theoretical statements.

22 Our philosophy of science is clearly a “non-separatist” sort. See Rudner, R., Philosophy of Social Science (Englewood Cliffs: Prentice-Hall, 1966)Google Scholar and Lakatos, Imre, “Falsification and the methodology of scientific research programs,” pp. 91–196Google Scholar in Lakatos, I. and Musgrave, A., eds., Criticism and the Growth of Knowledge (Cambridge: Cambridge University Press, 1970).Google Scholar

23 Lakatos, pp. 116–32. In brief, our approach to dependency is to treat it as a positive social theory containing certain propositions that, when suitably operationalized, can be empirically evaluated and whose truth content as measured by some criterion, such as R2, can be compared to the truth content of statements derived from competing approaches, such as conventional and Marxist economics. Unfortunately, in our view, many exponents of the dependency paradigm do not treat it as a positive theory but as an ideology whose truth is assumed or illustrated by apt examples rather than systematically evaluated via qualitative and quantitative comparisons. In this regard, see Nove, Alec, “On reading Andre Gunder Frank,” Journal of Development Studies 10 (April-July 1974): 445–55.CrossRefGoogle Scholar

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27 Ibid., pp. 10–13.

28 Ibid., pp. 13–18.

29 Ibid., p. 6.

30 O'Brien, Philip J., “A critique of Latin American theories of dependency,” pp. 7–27Google Scholar in 1. Oxaal, Barnett, T. and Booth, D., eds., Beyond the Sociology of Development (London and Boston: Routledge and Kegan Paul, 1975),Google Scholar and Alec Nove, “On reading Andre Gunder Frank.”

31 Nove, p. 455.

32 Ibid.

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34 Nove, pp. 448–53.

35 Ibid., pp. 446 and 452.

36 Robinson, Joan, Economic Philosophy (London: Pelican, 1964), p. 46.Google Scholar

37 O'Brien, pp. 11–12. We share O'Brien's judgment here. Dependency does not represent a theory in any meaningful sense of that term, but it is “a framework of reference” or “paradigm” within which “various heterogeneous phenomena are analysed to see how they link and interact with each other to form a total system.” Ibid. This is exactly the point of view argued by Duvall in his essay in this issue.

38 Ibid., pp. 19 and 24.

39 Ibid., p. 24.

40 Ibid., p. 25.

41 Lall, Sanjaya, “Is ‘dependence’ a useful concept in analysing underdevelopment?”, World Development 3 (November 1975): 799–810.CrossRefGoogle Scholar

42 Ibid., p. 808 and from a letter to the senior author from Professor Lall, August 24, 1976.

43 Ibid., p. 800.

44 Ibid., pp. 801–07.

45 Ibid., pp. 807–08.

46 Ibid., p. 809.

47 Weisskopf, Thomas E., “Dependence as an explanation of underdevelopment: a critique,” Paper presented at the Sixth National Meeting of the Latin American Studies Association, Atlanta, Georgia, March 1976.Google Scholar

48 lbid., pp. 3–4.

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50 Given that Schmitter's matrix was 20 countries by 102 variables, this was a dubious procedure, at best. Nevertheless, the resulting factors make a lot of sense even though they are a function of the variety of raw indicators inputed into the factor analysis.

51 Schmitter, pp. 170–73.

52 Ibid., pp. 154–55.

53 Kaufman, Robert R., Chemotsky, Harry I., and Geller, Daniel S., “A Preliminary test of the theory of dependency,” Comparative Politics 7 (April 1975): 303–30.CrossRefGoogle Scholar

54 Ibid., p. 312. Kaufman et al., unfortunately do not compare their results to Schmitter's, and the factor analyses are quite different. However, their second and third factors appear to be similar to Schmitter's trade dependency and private investment dependency.

55 Ibid., pp. 316–28.

56 Lall, p. 807.

57 Szymanski, Albert, “Dependence, exploitation, and economic growth,” Journal of Political and Military Sociology 4 (Spring 1976): 53–65.Google Scholar The quotations are found on page 53. We should note at this point that an article we have not yet seen is reported by Szymanski, p. 54, as having correlated measures of economic dependency with Latin American growth rates and “found mixed evidence in favor of the dependency theory.” Stevenson, Paul, “External economic variables influencing the economic growth rate of seven major Latin American nations,” Canadian Review of Sociology and Anthropology 9 (November 1972): 347–57.Google Scholar

58 Szymanski, pp. 57–59. With an N of 19, rho must equal ±. 38 to be significant at the. 05 level in a one-tailed test of significance and must equal ±. 55 at the. 01 level.

59 Nove, pp. 452–53. Indeed, one might observe that if the initial foreign investment did not promote economic activity, how could profits be earned which were then repatriated at a later date? This was exactly the problem encountered by much foreign investment in tropical Africa prior to World War II. See Charles Wilson, “The economic role and mainsprings of imperialism,” pp. 68–91 in Duignan, Peter and Gann, L.H., eds., Colonialism in Africa, 1870–1960, Volume 4: The Economics of Colonialism (Cambridge: Cambridge University Press, 1975).Google Scholar

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64 It is unfortunate that the author did not apply some clustering technique, such as factor analysis, to his fifteen dependency indicators in order to more properly test his first hypothesis of the interconnectedness of political, economic, and military dependency.

65 Vengroff, Richard, “Dependency, development, and inequality in black Africa,” paper read to the Annual Meetings of the African Studies Association, Boston, November 3–5, 1976.Google Scholar

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73 Ibid., p. 41.

74 R. Dan Walleri, “Economic imperialism as a cause for retarded economic development in the third world,” Paper presented at the Annual Meeting of the American Political Science Association, San Francisco, September 1975 and Walleri, , The Political Economy of International Inequality: A Test of Dependency Theory (Honolulu: University of Hawaii, unpublished Ph.D. dissertation in Political Science, August, 1976).Google Scholar We are grateful to Dr. Walleri for providing us with a copy of his dissertation.

75 Galtung, Johan, “A structural theory of imperialism,” Journal of Peace Research, No. 2, (1971): 101–02.CrossRefGoogle Scholar

76 GNPpc loaded highly in both cases. Walleri, “Economic imperialism,” Appendix III.

77 Ibid., p. 24.

78 Ibid., pp. 27–30.

79 Chase-Dunn, Christopher, “The effects of international economic dependence on development and inequality: a cross-national study,” American Sociological Review 40 (December 1975): 720–38.CrossRefGoogle Scholar

80 ln a letter to the senior author, Professor Chase-Dunn reports that his sample is “mostly Latin America,” October 6, 1976.

81 Investment dependence and debt dependence are correlated at the. 63 level, Chase-Dunn, p. 728.

82 Paukert, Felix, “Income distribution at different levels of development,” International Labor Review 108 (1973): 97–125.Google Scholar

83 Chase-Dunn, , “The effects of international economic dependence,” p. 735.Google Scholar

84 Wallerstein, The Modern World-System; “The rise and future demise of the world capitalist system”; and Rubinson, Richard, “The world economy and the distribution of income within states: a cross-national study,” American Sociological Review 41 (August 1976): 638–59.CrossRefGoogle Scholar

85 Suggesting that social science on a global scale manifests dependency structures too. However, such a point, which identifies a genuine problem, is irrelevant to the truth content of the findings reported in these eleven papers.

86 Kay, Development and Underdevelopment, but especially Warren, Bill, “Imperialism and capitalist industrialization,” New Left Review No. 81 (09–10 1973): 3–44Google Scholar and Sklar, Richard L., “Postimperialism: a class analysis of multinational corporate expansion,” Comparative Politics 9 (October 1976): 75–92.Google Scholar

87 Raymond Duvall, et al., “A formal model of ‘dependencia’ theory: structure, measurement, and some preliminary data,” Paper presented to the Edinburgh Congress of the International Political Science Association, August 16–21, 1976.

88 McGowan, , “Economic dependence and economic performance”, –31.Google Scholar

89 Ibid., p. 35.

90 We are indebted to Professor Phillip L. Beardsley of the Maxwell School, Syracuse University, for persuasively arguing this point to us.

91 For discussions of partial correlation analysis and causal inference see Blalock, Herbert M. Jr, Causal Inference in Nonexperimental Research (Chapel Hill: University of North Carolina Press, 1964), pp. 3–94Google Scholar; Blalock, , Social Statistics, 2nd ed. (New York: McGraw Hill, 1972), pp. 433–50Google Scholar; and Garson, G. David, Political Science Methods (Boston: Holbrook Press, 1976), pp. 357–61.Google Scholar

92 Ibid., and Alker, Hayward Jr, Mathematics and Politics (New York: Macmillan Co., 1965), pp. 116–29.Google Scholar

93 As summarized by Lall and Weisskopf.

94 Cardoso, F.H., Politique et developpment dans les societes dependantes (Paris: Anthropos, 1971)Google Scholar; Cardoso, F.H. and Faletto, E., Dependencies y desarrollo en America Latina (Mexico City: Siglo XXI Editores, 1969)Google Scholar; Cardoso, F.H., “Dependency and development in Latin America,” New Left Review (July-August 1972): 83–95Google Scholar; Cardoso, F.H. “Associated-Dependent Development: Theoretical and Political Implications,” pp. 142–76Google Scholar in Stepan, A., ed., Authoritarian Brazil (New Haven, Conn.: Yale University Press, 1973)Google Scholar; Cardoso, F.H., “Industrialization, Dependency, and Power in Latin America,” Berkeley Journal of Sociology, 18 (1972–73): 79–95.Google Scholar

95 Writings in addition to Nove and Lall that either argue or imply this point of view are: Zartman, I.W., “Europe and Africa: Decolonization or Dependency?,” Foreign Affairs, Vol. 54, No. 2 (January 1976): 325–43Google Scholar; Cohen, B.J., The Question of Imperialism (New York: Basic Books, 1973)Google Scholar; and Bauer, P. T., “The Economics of Resentment: Colonialism and Underdevelopment,” The Journal of Contemporary History, Vol. 4, No. 1 (1969): 51–71.Google Scholar

96 Our countries are: Benin, Burundi, Cameroun, Central African Republic, Chad, Congo Peoples Republic, Ethiopia, Gabon, Ghana, Guinea, Ivory Coast, Kenya, Liberia, Malagasy Republic, Malawi, Mali, Mauritania, Niger, Nigeria, Rwanda, Senegal, Sierra Leone, Somali Republic, Sudan, Tanzania, Togo, Uganda, Upper Volta, Zaire, and Zambia.

97 McGowan, pp. 37–38.

98 See Jacobson, A. L. and Lalu, N. M., “An empirical and algebraic analysis of alternative techniques for measuring unobserved variables,” pp. 215–42Google Scholar and Sullivan, J.L., “Multiple indicators: some criteria of selection,” pp. 243–69Google Scholar in Blalock, H.M. Jr, ed., Measurement in the Social Sciences (Chicago: Aldine, 1974).Google Scholar

99 But see Vengroff, “Dependency, development, and inequality,” which found no positive relationships between dependency and inequality for 14 of our cases.

100 Hance, William A., The Geography of Modern Africa, revised 2nd edition, (New York: Columbia University Press, 1975), p. 611.Google Scholar

101 Strangely enough, Hance does not define the concept he measures, ibid., pp. 611–18. Also note that to the extent that this concept incorporates prior successful economic performance, our analysis is biased in favor of dependency theory T1.

102 Hance, ibid., pp. 614–15 and Hance, W.A., “Development Limitations and Opportunities in Tropical Africa,” Africa Report (January 1967): 45Google Scholar, and Hance, W.A., African Economic Development 2nd ed., revised (New York: Praeger, 1967), pp. 242–97.Google Scholar

103 These eight indicators are coded 1 = poor or non-existent, 2 = fair, 3 = good, 4 = excellent.

104 These three are coded 1 = very difficult, 2 = difficult, 3 = not very difficult, 4 = not difficult. Note that for Hance, “average man” represents the mass of the population; it is not a surrogate for per capita.

105 Tufte, E.R., “Improving data analysis in political science,” World Politics, 21 (July 1969): 641–154Google Scholar; Abelson, R.P. and Tukey, J.W., “Efficient conversion of non-metric information into metric information,” pp. 407–17Google Scholar in Tufte, E.R. ed., The Quantitative Analysis of Social Problems (Reading, Mass.: Addison-Wesley, 1970),Google Scholar and Labovitz, S., “The assignment of numbers to rank order categories,” American Sociological Review, 35 (1970): 515–24.Google Scholar

106 Weisskopf, p. 4.

107 Ibid., pp. 4, 5.

108 Ibid., p. 5.

109 Sources are: Aidcon and Tradecon from Stallings, B., Economic Dependency in Africa and Latin America (Beverly Hills: Sage Professional Paper in Comparative Politics, 1972), pp. 20 and 28Google Scholar; Invesicon from UN Department of Economic and Social Affairs, Multinational Corporations in World Development (New York: U.N.D., 1973)Google Scholar ST/ECA/190; Fortrade from Adelman, I. and Morris, C.T., Society, Politics, and Economic Development (Baltimore: Johns Hopkins University Press, 1967), pp. 15, 126–28.Google Scholar

110 Weisskopf, p. 5.

111 Ibid.

112 Ibid.

113 Sources are: Commcon and Trade from Stallings, pp. 30, 58;lnvestpc and Invest from Reuber, G.L., Cookell, H., Emerson, M., and Gallis-Hammond, G., Private Foreign Investment in Development (Oxford: Clarendon Press, 1973), p. 275.Google Scholar

114 McGowan, pp. 36–39 and Section II of this paper.

115 Campbell, D.T. and Fiske, D.W., “Convergent and discriminant validation by the multi-trait-multimethod matrix,” Psychological Bulletin, 56 (March 1959): 81–105.CrossRefGoogle Scholar

116 Throughout the remainder of this paper we shall use the level of significance as a decision rule to distinguish between “large” and “small” correlations. We are not using it in a formal hypothesis testing sense.

117 That is, “dependency” may be like another so-called scientific concept, “race.” While race can be defined and measured by reference to blood types, gene pools, etc., as applied to humans it is a useless concept for it is not related to anything else of theoretical interest about human behavior!

118 Norman H. Nie, et al., SPSS: Statistical Package for the Social Sciences, 2nd ed. (New York: McGraw-Hill, 1975), pp. 346–47. Tolerance is the proportion of the variance of an independent variable not explained by the independent variables already in the equation.

119 Since dependency involves highly constrained decision making, such “patterns” may not represent “policies” in that.. a choice was never made.

120 As done, for example, in R. Harris, ed., The Political Economy of Africa.

121 But see Vengroff, “Dependency, development, and inequality.”

122 Kaufman, “A preliminary test.”

123 Because economic development potential has this character, relatively short time-series (≤ 20T) are unlikely to record much variation in it, necessitating a cross-sectional approach. For discussions of this problem and positive evaluations of the utility of cross-sectional analysis see Hibbs, D.A. JrMass Political Violence (New York: Wiley-Interscience, 1973), pp. 200–03Google Scholar; Kuh, E., “The validity of cross-sectionally estimated behavior equations in time series applications,” Econometrica, Vol. 27, No. 2 (April 1959): 197–214Google Scholar; and Kuh, E. and Meyer, J.R., “How extraneous are extraneous estimates,” Review of Economics and Statistics Vol. 39, No. 4 (November 1957): 380–93.Google Scholar

124 But see Kay, Geoffrey B., ed., The Political Economy of Colonialism in Ghana: A Collection of Documents and Statistics, 1900–1960 (Cambridge: Cambridge University Press, 1972)Google Scholar which contains 47 tables of time series data for 1900–1960 on economic and related variables.

125 Chase-Dunn, “The effects of international economic dependence.”