For any one economic growth/development models, briefly describe the model, and carefully compare and contrast its application to any two developing countries.

Economic Development Models

Name

Affiliation

Economic Development Models

Different economic development models have been the product of theorizing from various economic and political contexts . With regards to underdevelopment , the dependency model was chosen for discussion in this because the model itself was developed from the experience of underdeveloped countries . The experiences of the Philippines and Venezuela were selected for comparison and contrast because of their relationship to one developed country - the United States where the former is a loyal ally and the latter is presently an ally turned

critique

The Dependency Model

The Dependency Model as a theory of economic development is based on the premise that in the world today , there exists an unequal relationship between satellite and metropolitan countries . This relationship is based on the evolution of an international division of labor under the world capitalist system which dictates that the role of underdeveloped satellite countries is to provide cheap raw materials and labor necessary for industries in the metropolitan or capitalist countries (Todaro 2006 : 25

This is based on the assumption that economic and political dominance is held by capitalist countries and leads to the phenomena of neo-colonization that is the existence of dummy governments subservient to the economic interests of developed countries . Dummy governments are perpetuated by an elite class whose economic interests lie in the raw material export-finished products import orientation of domestic economy and whose political interests lie in protecting these class interests (Perkins , Radelet and Lindauer 2006 :24

Some Marxist-leaning dependency theorists attribute these relationships to the occurrence of the crisis of overproduction evident in imperialism where the economic survival of metropolitan states largely depends on the additional role of satellites as markets for finished products (Perkins , Radelet and Lindauer 2006 :24

The dependency theory was developed to mirror the underdevelopment and widespread poverty in Latin America which was a vastly contrasting experience to the trickle-down effect of economic wealth from capitalist countries as proposed in neoclassical models of economic growth . The dependency theory further opens alternative roads in attaining development

One is through local development of industries for domestic needs in that resources would serve the interest of the general population which at the same time reduces the need to import (Todaro 2006 : 401 This takes into account that genuine economic development is not only based on actual domestic production but more importantly in how resources and the gains in production actually benefit the people

However , this depends in part on the political will of third-world governments to effect necessary political and economic changes not for the elite but for the population living in poverty (Ferraro 2006

In general , the dependency model predicts a worsening and continued poverty in satellite states as long as the dependency relationship exists . Although there have been no actual third world experience proving the viability of certain methods undertaken to effect domestic economic development , the historical and prevailing circumstances of underdeveloped countries show that the only way out of dependency is through a change in...