Underdevelopment

In economics, underdevelopment is when resources are not used to their full socio-economic potential, with the result that local or regional development is slower in most cases than it should be. Furthermore, it results from the complex interplay of internal and external factors that allow less developed countries only a lop-sided development progression. Underdeveloped nations are characterized by a wide disparity between their rich and poor populations, and an unhealthy balance of trade. Symptoms of underdevelopment include lack of access to job opportunities, health care, drinkable water, food, education and housing.

Most Sub-Saharan African countries remain largely underdeveloped - street in Dakar, Senegal.

History

The world consists of a group of rich nations and a large number of poor nations. It is usually held that economic development takes place in a series of capitalist stages and that today’s underdeveloped countries are still in a stage of history through which the now developed countries passed long ago. The countries that are now fully developed have never been underdeveloped in the first place, though they might have been undeveloped.

Examples of underdeveloped countries and regions

A political map of the Human Development Index.

Afghanistan

Afghanistan is bordered on the north by Turkmenistan, Uzbekistan, and Tajikistan, on the extreme northeast by China, on the east and south by Pakistan, and by Iran on the west. The country is split east to west by the Hindu Kush mountain range, rising in the east to heights of 24,000 ft (7,315 m). Afghanistan's GDP for 2009 was $23.3 billion and annual per capita $800. In 2008 Unemployment was at 35% having a labor force of 15 million split between agriculture 80%, industry 10% and services 10%.

Afghanistan's underdevelopment has been fuelled by an ineffective trade policy meaning products are inefficiently traded and little economic growth is gained. This lack of trade agreements has been created due to pervasive political and military corruption and cultural and religious unrest leaving the country broken and the economy shattered. Gross domestic product had fallen significantly because of loss of labor and capital and disruption of trade and transport. Continuing internal conflict disadvantaged both domestic efforts at reconstruction as well as international aid efforts. The country today however is beginning to make some progress.

Latin America

Latin America, as it is most commonly thought as, is made up of the majority of American nations between Mexico in North America and Argentina in South America where the language is derived from Latin, including Spanish, Portuguese and French languages. Latin America is one of the most underdeveloped regions in the world due to their annual per capita income being less than 1,000 USD. Their life expectancies are twenty years less than the developed world as well as infant mortality rates being very high. Malnourishment, homelessness and unemployment are very common in this region as the countries are poor and backward having many communities filled with poverty. Latin America has suffered due to overpopulation, having no capacity to manage the people their situation has only become worse, with increased poverty and homelessness.

South Africa

It is argued that South Africa’s ... dualist qualities of a 1st & 2nd economy. The 1st (wealth producing sector) being one that is integrated in the global economy through modern industrialization, mining, agricultural & financial services, and the 2nd a structural manifestation of poverty, underdevelopment & marginalization. With indicators such as GDP/capita at PPP of $11 240 in 2001, placing it as one the 50th wealthiest countries in the world, and on the other hand social indicators that rank it 111th in terms of HDI for the same year.

Some of the causality of the underdevelopment is attributed to the institutionalized apartheid practices in South African politics, society and economics. The reforms that were introduced in 1994, have furthered the increase of inequality and uneven wealth distribution in the nation. As “Hoogeveen andO¨ zler (2005: 15) conclude that ‘Growth has not been pro-poor in South Africa as a whole, and in the instances when poverty declined for certain subgroups, the distributional shifts were still not pro-poor’.” Through the notion of adverse inclusion versus social exclusion du Toit draws attention to the fact that the present dynamics of the nation are not simply a result of being left out of mainstream economy, rather from the terms under which individuals are incorporated, . The individuals who find themselves incorporated are often not those that make up the majority of the population that lives in considerably unfavorable conditions.

Theories on underdevelopment

Modernization theory

Modernization theory is a sociology-economic theory, also known as the Development theory. This highlights the positive role played by the developed world in modernizing and facilitating sustainable development in underdeveloped nations. It is often contrasted with Dependency theory.

The theory of modernization consists of three parts:

• Identification of types of societies, and explanation of how those designated as modernized or relatively modernized differ from others;
• Specification of how societies become modernized, comparing factors that are more or less conducive to transformation.
• Generalizations about how the parts of a modernized society fit together, involving comparisons of stages of modernization and types of modernized societies with clarity about prospects for further modernization.

Dependency theory

Dependency theory is the body of theories by various intellectuals, both from the Third World and the First World, that suggest that the wealthy nations of the world need a peripheral group of poorer states in order to remain wealthy. Dependency theory states that the poverty of the countries in the periphery is not because they are not integrated into the world system, but because of how they are integrated into the system.

These poor nations provide natural resources, cheap labor, a destination for obsolete technology, and markets to the wealthy nations, without which they could not have the standard of living they enjoy. First world nations actively, but not necessarily consciously, perpetuate a state of dependency through various policies and initiatives. This state of dependency is multifaceted, involving economics, media control, politics, banking and finance, education, sport and all aspects of human resource development. Any attempt by the dependent nations to resist the influences of dependency could result in economic sanctions and/or military invasion and control. This is rare, however, and dependency is enforced far more by the wealthy nations setting the rules of international trade and commerce.

Dependency theory first emerged in the 1950s, advocated by Raul Prebisch whose research found that the wealth of poor nations tended to decrease when the wealth of rich nations increased. The theory quickly divided into diverse schools. Some, most notably Andre Gunder Frank and Walter Rodney adapted it to Marxism. "Standard" dependency theory differs sharply from Marxism, however, arguing against internationalism and any hope of progress in less developed nations towards industrialization and a liberating revolution. Former Brazilian President Fernando Henrique Cardoso wrote extensively on dependency theory while in political exile. The American sociologist Immanuel Wallerstein refined the Marxist aspect of the theory, and called it the "world system."

According to Brazilian social scientist, Theotonio Dos Santos, dependence means a situation in which certain countries economies’ are conditioned by the development & expansion of another to which the former is subject. He goes on to further clarify that the interdependence of two or more economies, and consequently world trade, assumes the form of dependence when dominant countries can create dependency only as a reflection of that expansion, which can have a negative effect on the subordinate’s immediate economy.

Guyanese Marxist historian and political activist, Walter Rodney, contends in reference to Africa`s underdevelopment, "The decisiveness of the short period of colonialism and its negative consequences for Africa spring mainly from the fact that Africa lost power. Power is the ultimate determinant in human society, being basic to the relations within any group and between groups. It implies the ability to defend one's interests and if necessary to impose one's will by any means available. In relations between peoples, the question of power determines maneuverability in bargaining, the extent to which a people survive as a physical and cultural entity. When one society finds itself forced to relinquish power entirely to another society, that in itself is a form of underdevelopment".

See also

• Development economics
• Development theory
• Economic development

General:

• Developed country
• Developing country