DEPENDENCY SCHOOL, THEORY OF INTERNATIONAL TRADE. Uneven development - Dependency. THEORY OF INTERNATIONAL TRADE, NEOLIBERALISM. Post-war mainstream theories- MODERNIZATION SCHOOL AND DEPENDENCY PERSPECTIVE. Structure of the presentation. 1) theories of growth
„we must embark on a bold new program for making the benefits of our scientific advances and industrial progress available for the improvement and growth
debtor countries were required to pursue a number of reforms which are known as the structural adjustment programmes (SAPs)
Fiscal policy discipline;
Redirection of public spending from subsidies ("especially indiscriminate subsidies") toward broad-based provision of key pro-growth, pro-poor services like primary education, primary health care and infrastructureinvestment;
Interest rates that are market determined and positive (but moderate) in real terms;
Competitive exchange rates;
Trade liberalization – liberalization of imports, with particular emphasis on elimination of quantitative restrictions (licensing, etc.); any trade protection to be provided by low and relatively uniform tariffs;
Privatization of state enterprises;
Deregulation – abolition of regulations that impede market entry or restrict competition, except for those justified on safety, environmental and consumer protection grounds, and prudent oversight of financial institutions; and,
Legal security for property rights.
any pay raises they may have received over what they made before trade liberalization are said to be offset by inflation,
whereas workers in the First World country become unemployed, while the wealthy owners of the multinational grow even more wealthy
but rather to severe economic crises and the accumulation of crippling external debts that render the target country beholden to the First World
Countries need to create a Poverty Reduction Strategy Paper (PRSP) where the freed resources are used effectively to alleviate poverty. The other two key elements emphasised are country-ownership and civil society participation.
Countries can achieve the decision point after three years of economic stability and an interim PRSP
Paris Club a group of major creditors set up in 1956 when Argentina’s debt had to be restructured for the first time.