The ideas of the modernisation theorists, particularly those of Walt Rostow, remained dominant throughout the 1960s, but it was not long before they came under sustained critique from the intellectual left, who developed a counter-tradition: the dependencia, or dependency, school of thought.
The kernel of this thinking developed within the UN Economic Commission for Latin America and the Caribbean, (Eclac, or Cepal as it is often known, after its Spanish acronym). Founded in the 1950s to carry out research that would contribute to greater development across the continent, Eclac was a training ground for many dependency writers. Like a modern-day thinktank, it sought to overturn many of the rather western-centric assumptions of modernisation theory, replacing them with a critique of the unequal terms of economic exchange between core (rich) and periphery (poor) countries.
This approach set the tone for the dependency school. But it was the likes of Andre Gunder Frank who would go on to politicise – and indeed radicalise – the message, in publications such as his 1967 book Capitalism and Underdevelopment in Latin America.
Frank was, in many ways, a rather unlikely radical, having been trained at the notoriously free market Chicago School of Economics (the bad guys in Naomi Klein's The Shock Doctrine) under the supervision of the school's head, Milton Friedman. But quite unlike his supervisor, in the early 1970s Frank worked under Chile's socialist president, Salvador Allende, not against him. And this experience of working outside the metropolitan centres was to be central to his radical perspective.
Above all, it prompted him to notice what he saw as the unforgivable historical amnesia of mainstream development theories. Rather than taking poor countries' impoverished status as the starting point for analysis, he argued, their poverty ought to be thought of as the end point. This was the heart of the underdevelopment critique: the claim that what made rich nations rich and kept poor nations poor was not geographical bad luck or the wrong policies, much less an unproductive "culture", but the ongoing legacy of colonialism, slavery and resource extraction. Frank's colleague, the Stanford economist Paul Baran, neatly summarised this as "plunder thinly veiled as trade".
In short, Frank was saying that while today's rich countries may once have been undeveloped, they were never underdeveloped in anything like the same way. Moreover, this was not a case of unintended consequences. It was central to the whole capitalist enterprise. If we stand back and look at the capitalist system as a whole, he said, it is impossible not to notice "its simultaneous generation of underdevelopment in some of its parts and of economic development in others". This primary observation led to a host of follow-on arguments, such as the idea that the exploitation of poor countries by rich ones is possible only because ruling elites in poor countries have something to gain from that exploitation, and are therefore complicit at every level – nationally, regionally and locally – resulting in a cycle of repeated exploitation and misery.
The only possible solution to this rather hopeless situation, Frank believed, was socialism – although this was a conclusion that, like Rostow's unflinching adherence to capitalism (and damn the costs), he reached before carrying out his research. We don't have to agree with Frank on the solution, however, to recognise the many useful insights to come from the dependency critique more broadly: such as the idea that even if countries could successfully begin to develop – and not all dependency theorists thought that they could – they would never do so in a vacuum, as modernisation theorists believed. They would be increasingly propelled into a world system already clanking away at full speed.
That may not sound so novel or insightful today. But it is interesting in retrospect because here, much more clearly than before, is a deliberate concern to consider the material forces of history – the actual lived reality of the world – when elaborating a model of economic development (rather than simply sketching it out according to the abstract reckonings of neoclassical economics). As a result, we can detect here a whiff of the idea that it is inequality as much as absolute poverty that most accounts for the problems of global poverty.
But do the insights of dependency theorists still hold water? The somewhat pessimistic implication of the dependency approach is to assume that poor countries can only improve their condition by de-linking from the world economy. And as Frank himself was later to acknowledge, that makes it very hard to develop at all. Moreover, it has been largely disproved by the experience of the east Asian tiger economies: something other dependency scholars, such as the Brazilian intellectual and later president Fernando Henrique Cardoso, recognised at the time. But, above all, dependency theory could never really account for the sheer variety of experiences that poor countries around the world exhibit.
In its hardline form, then, dependency theory is of perhaps limited value today, which reiterates a lesson learned from modernisation: that when theories become all encompassing, they tend to become ever further removed from useful policy advice.
It is nonetheless clear that the problems of uneven starting points and the structural unfairness of global capitalism that interested Frank and others have not gone away. And the underlying critique of western chauvinism (that western-style capitalist democracy is the best model for the rest) remains pertinent when people persist in talking of development "ladders", for example. Perhaps more important, Frank's belief that we too readily overlook the way that too many of the privileges of the rich nations are not only unearned but predicated upon the prior and active removal of that wealth from others is, if anything, making something of a comeback in these days of heightened discussion of inequality.