Access to the ability to achieve an elevated sense of livelihood is uneven within the broad process of globalization. This is especially true in a more knowledge-based economy, which seems to be the current norm. Inequality of this kind is not only between nation-states, but for each and every one of us within our respective countries. Using alternative theories such as dependency theory, international political economy and geographical political economy, the dynamics of inequality will be highlighted and explored. Incorporating material pertaining to neoliberal theory, hegemony, regimes, and denationalization will show the discord surrounding the causal effects of uneven development. These theories, however, do not disprove developmental inequality but rather add depth and nuance to the argument. Focused emphasis in the regions of Latin America, and Southeast Asia – including China and Japan – will be used to build a case-study. These regions will illuminate how uneven development looks within international systems, and possible methods of reaching a more sustainable equilibrium.
Explanation, Definition and Scope
Before diving into theory and application, certain terms should be defined. Livelihood is a purposely used term to encapsulate the numerous factors that define a nation’s health. The factors considered towards identifying a nation’s health include: personal freedoms, legitimate governing, access to food and water, access to the means of commerce both internal and external of national boundaries, as well as access to modes of potential knowledge creation for its individual citizens. Being able to create, ingest and possess knowledge is particularly crucial in today’s era of quick technology and communication. Within a knowledge-based economy, possession of knowledge is argued as being a most crucial idea. It is not so much that nations with a higher health are better or more evolved than lower defined nations, more precisely access to the ability to achieve a higher sense of livelihood is more readily available in countries with a higher national health. The term livelihood as well as the term national health are more of an approximation, due to the inherently infinite amount of possible factors present in human relations and therefore any subset of relations dealing with humans, including IR. The point of this essay is not to argue for an exact, absolute solution, or law, as these things are too complex to define and their value can be argued as negligible when pertaining to human nature. Human nature as a concept is also incredibly fluid in definition and begs to wonder why we seek such singular theories in IR in the first place. When instead, we might benefit more if we focused on seeking relativity in our collective theories.
There was a conscious effort to exclude realism, which is a theory best thought of in terms of force, a topic which is not central to this essay. There is, however, considerable questions regarding the relevance of realism in post-Cold-war conditions and the theories’ dependency on security being the chief motivator in IR (Dunne, 2013, p. 91). Has the acceleration of globalization shown that there are other concerns as important as security to a nation’s health? Within realism you are also able to gain further understanding of hegemonic power and their potential regional effects. Realism should be studied but it does not harm the central argument of this essay to exclude its analysis.
Theories of Study
To begin an argument dealing with International Relations, it is imperative that the theory behind forthcoming assumptions be made clear in an effort to maintain transparency. This section will explain the thoughts surrounding dependency theory, international political economy (IPE) and geographical political economy. Neoliberal theory, hegemony, theories about regimes and denationalization will also be covered in order to understand the discourse found in IR related to perceived inequalities within the international structure. While these theories are not the only theories present in IR, they are ideologies that appear rather adept at describing international development in a spatial manner. Being able to imagine what a division of labor looks like as well as knowing how it operates becomes a handy tool to carry. After understanding these theories you will be able to draw a map and legend that will guide you through the argument of international inequality.
Dependency theory came about from theories examining the expansionary behaviors of nations after the early-modern period and up to the first Great War. This examination is often referred to as imperialism or colonialism (Dunne, 2013, p. 159). The differences present in dependency from its predecessors are that it applies more to the modern world and is thematically focused on the periphery nations within imperialism.
Zeev Gorin (1980) explains dependency theory has having intellectual roots traced, among others, to the theory of imperialism, and the distinction between the two is in the degree of emphasis on the different parts of the imperialist world system. While the theory of imperialism focuses on the dynamic of expansion inherent in the dominating (core) countries, dependency theory focuses on the consequences of this domination for the subordinated (peripheral) societies or areas. (p. 250)
The dynamics between the core and periphery can be explained within the scope of this essay as the nations within the ‘core’ often exhibiting more national health and therefore greater access for its population to achieve a higher degree of livelihood. At whose expense does the healthy nation take advantage? That could easily be seen as the central debate of this essay. Theorists like Theotonio dos Santos take the tenants of dependency and apply it to American domination in the form of an economic and security hegemony. Santos (2012) in talking about Russia with his usual flare for language describes this hegemony by saying the United States “as the world’s largest debtor had attained the parasitic stage that characterizes imperial powers during their prime and the beginning of their decadence” (p. 47). Within that quote he captures imperialism, hegemony and economics into one very sharp comment. However, Santos’ comment more hints at exploring what he means in regards to the economy and American debt. These topics will be discussed in greater detail when applied in argument. International political economy, however, shares many of the same threads of thought that dependency theory holds true.
International political economy can be a rather fascinating and complex set of theories to try and comprehend. Susan Strange (1996) sums a quick explanation in proclaiming “where states were once the masters of markets, now it is the markets which, on many crucial issues, are the masters over the governments of states” (p.4). While that statement was used to illicit an emotional effect, IPE focuses mostly on the dynamics present in state-market balance of power. The similarities of dependency and IPE can be found in hegemonic theory, within IPE that can be either a state, private entity, or a public organization. Hegemonic discourse is divided in IPE, but the study of hegemony and it underlying effects are undertaken. Amanda Dickens (2006) describes this divide as two groups with opposing beliefs in the “role of hegemony in stabilizing the international economy and creating or shoring up its framework of governing institutions” (p. 480).
IPE differs from dependency in its capacity to comprehend the existence of a knowledge-based economy and the role of possession, or property rights, as being highly important (Dickens, 2006, p. 486). With the theories of IPE there is also room for any global organization to have a power dynamic, even such organizations as the International Federation of Association Football (FIFA) or the International Olympic Committee (IOC), which are based on athletics. IPE goes to great lengths at incorporating criminal and terrorist regimes and organizations into units of measure within the global system. Strange (1996) describes criminal non-state actors as both states and mafias own and operate economic enterprises, although for both the survival of the organization take precedence over profit maximization. Like a state, too, a mafia is an economic parasite, in the sense that is raises revenue from civil society by demanding payment for protection. (p. 110) Previous theories, including dependency theory, struggle with incorporating non-state actors onto the examination table. In a knowledge-based economy not only do states have the right to possess and utilize knowledge, but also many highly differentiated types of organizations. How these entities maneuver and operate globally should be a subject of both IR and Geography.
Geographical political economy, like IPE and dependency, deals with the spaces created within the capitalist structure of economy. It is in this space where livelihood, national health and IR meet and become a web of entanglements. Eric Sheppard (2012) visualizes this entanglement as “flickering across the landscape, interconnecting bodies, firms, markets, neighborhoods, cities, regions and countries in ways that reflect, reproduce and transform the connectivities of economy and their place-based imprints” (p. 47). It is place-based imprints that bring us closer to the human within these lofty theories of IR. Geographical political economy deals heavily in the idea that trade and culture are intrinsically connected. Sheppard (2012) states “commodity trade has always been entangled with culture. The process of trade itself is encultured” (p. 36). Delving deeper into geographical political economy goes all the way down to basic questions of gender. The theories that help visualize the inequality present in divisions of labor, however, are better suited for this essay.
To continue the stance of threading relativity throughout theories of IR, using geographical political economy to visualize a division of labor and the product value chain aides in spatially identifying the theories of IPE and dependency. Breaking apart the modes of production from extraction to the very highest addition of value and then final sale is crucial to understanding how international development is uneven. It is within these processes of trade the conditions in which nations must operate become apparent. Understanding this process goes towards understanding the idea of national health and the factors that build it. We are able to understand more intimately what a nation will do in order to secure its position within the division of labor and potentially rise or upgrade in productivity. To gain a complete picture of how a nation’s health might be tied to the division of labor or product value chain we must talk about neoliberalism, hegemony, regimes and denationalization, or what is simply known as globalization.
Neoliberalism, hegemony, regimes and denationalization can be argued as the mainstream currents of IR. Together they resemble what might also be modern globalization. Geographical political economy differentiates the conditions up to the First World War as the first wave of globalization. Post-war, or the cold-war period, and the fall of the Bretton wood accords as being the second, or modern phase of globalization that we are currently experiencing. The fall in transportation cost and the acceleration of communications post-war play a vast role in this development (Sheppard, 2012, p. 44). However, the mainstream theories of IR seem to have accelerated even further the process of globalization since the 1990’s and the fall of the Soviet Union (Sheppard, 2012, p. 44-45).
Neoliberalism, with its trifecta of criteria and acceptance of a self-help structure in IR is an important factor in uneven development between nations. Much like general liberalism, neoliberalism posits that partaking in international organizations, an openness of economy and democracy within internal governing as the chief ways to construct a more peaceful society (Dunne, 2013, p. 95). It is within this theory the prevalence of capitalism has found a well- suited home. Capitalism is best employed in free-markets and in conditions of free-will, both of which are designed into neoliberalism. Within this world of free-markets, regimes and hegemony appear. Institutions like the International Monetary Fund (IMF), the Organization of the Petroleum Exporting Countries (OPEC), The World Trade Organization (WTO), and the United Nations (UN) can be seen as dominate regimes. Regimes are best looked at like an individual actor that is constructed of cooperating parts working in tandem. Robert Keohane (1984) describes this cooperation in saying “cooperation occurs when actors adjust their behavior to the actual or anticipated preferences of others, through a process of policy coordination” (p.49). Understanding regimes and the dominance of hegemonic interest, regardless of if they create stability or not, are important when grasping the force in which states collectively apply persuasion on other nations.
Many regimes are often considered to be created and controlled by the interest of the leading hegemonic power, in this case the Unites States. Koehane’s writing on regimes does well at incorporating the importance of hegemonic power. He talks about the effects of regimes actually accenting a hegemonic power’s standing within IR (Koehane, 1984, p. 49). Richard Saul (2012) in writing about the financial crises of 2008 ties together hegemony and regimes in saying “further and directly related to the ideational basis of American hegemony, the crisis appears to have marked a watershed for the financially driven neoliberal growth model that has dominated economic policymaking in most of the world’s leading economies” (p. 323). American policy and the regimes of international trade were both clearly connected to each other in the crisis of 2007-2008. American interest and international regimes push for open economies in the international system. While deregulating trade and partaking in international cooperation has lifted the livelihood of numerous low-income nations, neoliberalism has yet to solidly rectify those countries that do not rise.
Denationalization is the extension of society beyond the borders of nation-states (Albert, 2001, p. 119). It posits not that there is a creation of a new world order, homogenous in nature, but rather the continued importance of nations-states is in question (Albert, 2001, p. 120). International organization, when imagining them in a global governance role, still lack the abilities to provide welfare and security over the state (Albert, 2001, p. 120). Nation have not given up their authority and therefore there hasn’t been adequate distribution of power. It is worthy to note denationalization because the process is occurring but at a lesser rate than posited in mainstream denationalization theory. The European Union (EU) can be seen as an early, testable example of denationalizations slow process. While the EU operates above the states in many accounts, there is still the fundamental recognition of each individual state within the union (Collard-Wexler, 2006, p. 426). Denationalization also aids this essay in the sense that it holds some of the clues that can potentially help with increasing the livelihood of less healthy nations and reaching more of a relative equilibrium in the international system.
In the foreseeable future, barring any major shift in international security concerns, the uneven national development demanded by neoliberalism and the processes of globalization will continue. For the sake of simplicity, the term globalization moving forward will encapsulate neoliberalism, denationalization, and the economic and cultural processes of globalization. Now that the theories used for research have been explained, a simple map highlighting potential trajectories of inequality can be visualized. Expanding upon this visualization, a path of relativity between each theory can be used to tie this map of inequality to the real world. Further expanding upon a path of relativity between each theory before using case specific studies, however, will aide in better understanding each region that will be looked at.
Globalization within a knowledge-based economy almost demands uneven development because wealthier, argued as healthier, countries own the means to achieve a greater livelihood (Shie & Meer, 2010, p. 85). According to Vincent Shie and Craig Meer (2010) “advanced countries have the capabilities to produce core components and to accumulate knowledge of marketing management. Therefore, low-end manufacturing has been largely, if not totally, transferred to poor countries” (p. 85). This deep well of knowledge is due to the possession and creation of knowledge, which is highly important in a knowledge-based economy. Shie & Meer go further in describing a wealthier states accumulation of knowledge when communicating that wealthier countries overwhelmingly house more institutions of education than less healthy nations (Shie & Meer, 2010, p. 86). High quality research and development, which is crucial to the creation of new technology and knowledge are tied to countries with high wages, education, freedoms, and infrastructure (Shie & Meer, 2010, p. 87). This profound gravity of knowledge is also quite apparent when Shie & Meer communicate the vast majority of patents, which are forms of possession, as being tilted towards healthier states (Shie & Meer, 2010, p. 88-90). Quite simply, healthier nations own the abilities to use and synthesis knowledge by possessing its rights, having the right conditions for its creation and by not allowing the know-how to diffuse to less healthy nations.
Uneven development is heightened and focused in a knowledge-based economy using neoliberal action. Less healthy nations, commonly referred to as the global south, become trapped in a cycle that is self-defeating. Throughout a division of labor or product value chain, the conditions a country must provide internally increases at each link (Fichter & Sydow, 2002, p. 6). The value within the final product is also elevated along each step (Fichter& Sydow, 2002, p. 6). Inversely, the required capital increases along each link of the chain. Increasing the value of production requires increasing the overall health of a nation. Under neoliberalism, a nation will deregulate and liberalize its economy in order to attract foreign investment. This is often in the form of a reduction in labor wages, labor rights and protecting the access to knowledge contained within the foreign investment (Shie & Meer, 2010, p. 85-86). While this does provide moderate gains and a rise in the middle-class of a nation it is not sustainable (Shie & Meer, 2010, p. 83). With the creation of a middle-class comes the demands of a middle-class, which is another way of describing the increases in livelihood a country must provide to increase production value. However, the rise in resources used to lift the livelihood of a nation is not possessed in any stable fashion.
Eric Sheppard (2012) summed this uneven exchange between a powerful core and a dependent periphery created a global division of labor between industrial and primary commodities, with organized labor in the core negotiating higher wages, subsidized by low wages in a disempowered periphery. Low wages result in a domestic market that is too small to support domestic periphery capitalism, perpetuating underdevelopment. (p. 55)
When a state is unable to sustain its growth it often turns to the institutions of neoliberalism to secure loans, assistance or further investment. More often than not, the neoliberal institutions require further liberalization and deregulating in exchange for funds. This does little for supporting the newly minted middle-class of a less healthy nation. Less healthy nations are trapped in a one-step forward, two-steps back cycle that only increases the ratio between them and healthier nations. Paul Davidson (2002) pinpoints an increased level of capital drain from less healthy nations since 1973 in saying “moreover, during the last decades of the twentieth century, bout of flight capital drained resources from the relatively poor nations toward the richer ones, resulting in a more global inequitable redistribution of income and wealth (p. 482). Arguably, this does not enable those in a less healthy nations to have as much access to the abilities to achieve a heightened sense of livelihood that can be sustained. The chart below represents a simple reference that shows the exchange between divisions of labor and a nation’s health. As well, it showcases a potential need to allow property and knowledge to diffuse into a foreign market at a higher rate. This process will allow for a more robust domestic environment, which places more abilities to achieve a heightened sense of livelihood within grasp.
Latin America was used by Shie and Meer (2010) to describe the control of hegemony on a periphery. In talking about the electronics industry and Latin America’s failure to upgrade in productions they say “with the shortage of R&D activities and scientist (as well as brain drain), another explanation for the weak performance of Latin America in electronics is that Latin America was controlled by the United States economically and politically, and the United States saw no need to transfer technology” (p. 87). This is profound because it is shows that technology was not diffused and possessed in a stable manner that allows for synthesis. Furthermore, the phrase brain drain describes quite well the process of a knowledge-based economy. Latin America is being drained of it potential creation of knowledge by not educating its citizens, educating them abroad, or through complete immigration. While Mexico and Brazil have shown signs of improvement, the majority of Latin American countries face the conditions a less healthy nation faces being relegated to low-income production (Shie & Meer, 2010, p. 87).
China and Japan represent nations that are utilizing creative tactics in order to secure their position. However, those tactics are still because of dependency on the core, or hegemonic power in IR. Santos (2011) states, “countries like China and Japan still need to buy (American) bonds in order to ensure that their exports will have a market. Eventually, we face massive devaluation of the dollar. This currency is already showing signs of weakness in relation to the euro and the yen” (pg. 51). Japan and China both purchase US bonds to keep the value of the US dollar high because that keeps American citizens buying Asian exports. More specifically, the exports Americans buy are at the value of currency which is supported by China and Japan buying US bonds.
China, as a specific example, faces stronger challenges than Japan. Richard Saull (2012) describes this by saying, “57 percent of all Chinese exports are produced by foreign-owned firms, of which US multinationals dominate accounting for almost a quarter of all exports. Further, China tends to dominate in the export of lower-end valued goods and has not, so far, managed to seriously dent the technological leads of Western and Japanese producers” (p. 326). It is hard to not hear previous comments made in this essay pertaining to the inequality between states in international development. While China is growing quickly, it still lacks in higher value production.
Taiwan and India represent a good study for this essay. Taiwan is a nation often considered to have surfed the wave of capitalism quite well. India is also making headway in the global economy by means of software service and multinational outsourcing (Shie & Meer, 2010, p. 88). Looking closer at Taiwan, there are still very large signs of dependency and uneven development. Specifically, Taiwan is known for a being a hot spot for intellectual capital creation (Shie & Meer, 2010, p. 85). When looking at Taiwan in detail and in comparison to other nations, Taiwanese companies only produce “less than 10 percent of their own equipment” (Shie & Meer, 2010, p. 85). The equipment is owned, because of intellectual property and a knowledge-based economy, by a healthier nation and Taiwanese producers manufacture the parts. Taiwan as an intellectual foundry is over-exaggerated and merely shows the moderate gains within reach. India, as well, might represent an overstatement in success. India has gone to great lengths in upgrading its research and development capabilities. However, the US still outpaced India by some 30 percent (Shie & Meer, 2010, p. 91). Looking further into intellectual capital and India, the amount of US patents granted to Indian resident was only 481 in 2006. If we compare that to Taiwan, which had around 5,586, we can see clearly there is a divide in knowledge (World Intellectual Property Organization [WIPO] 2007).
The examples used show how through the theories researched and then applied, uneven development in a knowledge-based economy is complex but noticeable. To sum up this case study, some examples of possible methods and initiatives that can be used to equalize, to certain degrees, the uneven development that has been uncovered. Santos maintains that US hegemony is still needed but that a new shift in thinking about the periphery is warranted (Santos, 2011, p. 53). Gradual change appears logical, unless a shock in the system is being sought. There are, however, grave risk involved in drastic and sudden changes to any system. Santos is more hinting at much stronger cooperation among less healthy nations in a purposeful front against unfair conditions in the global economy (Santos, 2011, p. 53). Reworded, it a very normative stance less healthy nations must take together against a majority. Santos goes in further detail when communicating a needed skepticism in the international institutions of neoliberal design. To enact his theory, it is imperative that the global south gain a stronger say in those institutions or develop better suited organizations (Santos, 2011, p. 55).
Cooperation is key, especially important when confronting the ideologies surrounding property rights. Possessing the means to create and synthesis knowledge is something which less healthy, global south, or Third-world countries need to enable. A conscious, normative response aimed at equalizing access to the possession of knowledge, through intense cooperation is a worthy route to take in IR. If the current global system is maintained, however, denationalization might bring about an accelerated amount of diffuse knowledge leaving the owners hands. There could be an ad-hoc type of development that aggregates into an overall average progression. This definitely appears more to be leaving it to the mercy of the system and less much rational in nature. The price we pay in this current system is of a violent nature, the dynamics are highly fluid and often uncontrollable. Creating methods of equality that are not won with blood or coercion and can be controlled to a greater degree, should be fleshed out more strongly. It is often said that humans are the most social being in creation; we should seek highly social means to solve our collective problems.
Relativities among theories of IR do not seem to be very hard to pick-out. There is, however, constant divide and a sort of talk-over each other that occurs in discourse. Many of the theories discussed in this essay share common threads and relations to one another. Many are direct answers or complete rebuttals that by default share a similar base. For instance, neorealism and neoliberalism both posit the structure of IR is anarchic. Both theories diverge heavily in how they explain that anarchic structure. Understanding IR means to understand numerous theories and how they intertwine to explain an interconnected world. The argument presented is that those theories show an uneven and often purposely tiled playing field for the actors and agents of IR.
The theories and ideas contained in dependency, international political economy and geographic political economy communicate from the perspective of the periphery and divisions of labor. Not only using the division of labor, but the product value chain to illustrate the national achievements necessary to upgrade, highlight inequality in the international system. The avenues of governance and conditions entities place on a population can be profound. What a nation will do to upgrade and elevate the livelihood of its national health is often self-defeating because of the theories that focus more on the core nations. Neoliberalism, regimes, hegemony and denationalization all tell the story from a perspective away from the periphery. The leading ideologies in neoliberalism demand liberalization of economies that often undermine the middle-class and reduce the abilities to achieve an elevated sense of livelihood. As mentioned early, it appears this is a one-step forward, two-steps back type of process that enables a healthy nation to increase the distance between a less healthy state, which in-turn creates a dependency and inequality.
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