Dependency Theory

Background: After the 2nd world war when the African Asian (colonized countries) became independent they started thinking about how to improve their economy.. At the international level the United Nations club up mingled institutions to help the developing countries. Ex: UNDP .There were also some regional organizations, continent wise institutions. The one for Latin America was called ECLA, this was set up by the UN. Ecla was set up to help the Latin American countries for policies in their economy. For Asia was ESCAF which was ground in Bangkok. The Latin American one was the most intellectually dynamic of the regional based institutions. It was led by a visionary economist Raul Pesnon. He was the head of ECLA. He and his team of economist suggested a resultant for the problem of development . And that solution was called ISI-import replace industrialization. Development countries at that time were mainly dependent on agriculture or mining for their economy. Most people agreed that was not sound enough. To develop you must industrialize the economy. But how do u go about industrializing your economy. So ECLA suggested a solution. The developing countries utilize to import most of the industrialized products that they used from western countries.



As long as u import, your domestic products will neer be able to compete with these imported products. Therefore u must stop or reduce importing goods. And kinda try to produce substitutes at home. So it is called import substituting industrialization.. ISI was working well for a few years. industries were growing and economy was doing good. But after some time the whole mold lost steam. It lost its dynamism. Somehow the strategy had failed to induce bear on development. Then people began to ask why did it fail. And in move to this understand this failure two opposite executes emerged
One answer was given by neo classical/traditional(right wing neo classical) economist. They said this idea of producing...If you want to get a full essay, order it on our website: Ordercustompaper.com



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