Contribution of Dependency Theorist to explain unequal economic systems
Dependency theory is the notion that resources
flow from a "periphery" of poor and underdeveloped states to a
"core" of wealthy states, enriching the latter at the expense of the
former. It is a central contention of dependency theory that poor states are
impoverished and rich ones enriched by the way poor states
are integrated into the "world system". This theory was officially
developed in the late 1960s following World War II, as scholars searched for
the root issue in the lack of development in Latin America.
The theory
arose as a reaction to modernization theory, an earlier theory of development
which held that all societies progress through similar stages of development,
that today's underdeveloped areas are thus in a similar situation to that of
today's developed areas at some time in the past, and that, therefore, the task
of helping the underdeveloped areas out of poverty is to accelerate them along
this supposed common path of development, by various means such as investment,
technology transfers, and closer integration into the world market. Dependency
theory rejected this view, arguing that underdeveloped countries are not merely
primitive versions of developed countries, but have unique features and
structures of their own; and, importantly, are in the situation of being the
weaker members in a world market economy.
Income
inequality, in economics, significant disparity in the distribution of income
between individuals, groups, populations, social classes, or countries. Income
inequality is a major dimension of social stratification and social class. It
affects and is affected by many other forms of inequality, such as inequalities
of wealth, political power, and social status. Income is a major determinant of
quality of life, affecting the health and well-being of individuals and
families, and varies by social factors such as sex, age, and race or ethnicity.
On a global level, income inequality is extreme
by any measure, with the richest 1 percent of people in the world receiving as
much as the bottom 56 percent in the early 21st century. Within the United
States, income inequality is much greater than in most other developed
countries. In 2014, the richest 1 percent received 22 percent of total income,
and the top 10 percent of U.S. households received about 60 percent of total income.
Kinds Of Income Inequality : One’s occupation is a central basis for differences in income for most
people. In more-developed countries such as the United States, wages and
salaries are the major source of income for most households, while property,
including capital gains, is the major source for the most affluent. Income
inequality can be studied within countries, between countries, or across the
world’s population without regard to national boundaries.
The theory
arose as a reaction to modernization theory, an earlier theory of development
which held that all societies progress through similar stages of development,
that today's underdeveloped areas are thus in a similar situation to that of
today's developed areas at some time in the past, and that, therefore, the task
of helping the underdeveloped areas out of poverty is to accelerate them along
this supposed common path of development, by various means such as investment,
technology transfers, and closer integration into the world market. Dependency
theory rejected this view, arguing that underdeveloped countries are not merely
primitive versions of developed countries, but have unique features and
structures of their own; and, importantly, are in the situation of being the
weaker members in a world market economy.
Income
inequality, in economics, significant disparity in the distribution of income
between individuals, groups, populations, social classes, or countries. Income
inequality is a major dimension of social stratification and social class. It
affects and is affected by many other forms of inequality, such as inequalities
of wealth, political power, and social status. Income is a major determinant of
quality of life, affecting the health and well-being of individuals and
families, and varies by social factors such as sex, age, and race or ethnicity.
Despite popular belief that income inequality
largely reflects individual differences in talent and motivation, there are
also significant structural and cultural causes, such as segmented labour
markets, discrimination, institutionalized racism and sexism, gender roles, and
family responsibilities. Other legal, political, and economic factors—such as
corporate power, degree of private versus public (or common) ownership and
control of resources, collective-bargaining frameworks, and minimum-wage
laws—also affect income levels independently of individual traits. Income
inequalities can have different implications for levels of well-being in
different countries, depending on whether other basic needs such as housing,
health care, and food are largely market-based and on whether people have
access to productive resources such as land, water, and technology.
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