Development through the exploitation

Many of the current developed countries had been exploiting to other countries in the past, because of the control of natural resources, trading areas or cheap hand labour.

Is the development of one country the cause of underdevelopment of other country?

What is true, is that the trading expands favoring some countries and harming some others.

According to Inmanuel Wallerstein (1930) "our richness depends to the poorness of others".

All the economies in the world depend of a global system (mainly established by the capitalism rules). The market transfers the resources from one countries to others.  The central economies exploits to peripherical ones.  The exploitation happens because:

• The central countries have free hand labour and salaried, besides, these countries export finish goods and import raw materials.  
• However the peripherical countries the hand labour is not free and these countries export raw materials and import finish goods.

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This situation make that the balance of payments is always negative in a permanent state of dependency.  There is an unequal interchange.

It is argued that rich nations have exploited many poor nations by buying up their natural resources and the food crops they produce at very low prices, and the using these resources to produce goods and services which they then export back to the same less developed countries at much higher prices. Further, many rich countries have protected their own mining and agricultural industries by paying them subsidies.  These subsidies have increased the global supply of these products and forced down world prices.  Producers in less developed countries have not been able to compete as a result, they have lost sales, incomes and jobs.

The international trade has actually increased the ga between rich and poor countries because multinational firms and consumers from rich, developed economies dominate global markets.  As a result they are able to force producers of materials and goods in less developed countries to accept low prices.

The main critique to the arguments of Wallerstein is that the peripherical countries will adquire the cualification of central with the capital investments and the technology diffusion.

Bibliography:

Cameron R. (1992).  Historia Económica Mundial.  Alianza.  Capítulo 1.

Jones E.L. (1990). El milagro europeo. Alianza. Madrid. Introducción y cap. 12.

Mokyr. J. (1987).  La revolución industrial y la Nueva Historia Económica", "Revista de Historia Económica".  Vol. 2. pp 203-41; vol 3, pp 441-82.

North, D.C.,  y Tomas, R.P. (1989).  El nacimiento del mundo occidental.  Una nueva historia económica (900-1700).  Capítulos 1 y 2.