Development: Theory and practice

The purpose of this paper is to analyse the development successes and failures of certain countries taking into account whether specific development theories have been applied successfully or not. In order to do so, I will briefly outline the tenets of the main development theories focussing on their constructive aspects without silencing the criticism held against them. Subsequently, I will discuss the different understandings of the term “development” which will be followed by country-specific analyses of development successes and failures in the light of development theory for which East Asia, Nigeria and Cuba will be used as case studies. Lastly, I will discuss whether reality really proved the predictions of development theory wrong. Generally speaking, the spirit of Peter W. Preston’s attitude expressed in his article Development Theory: Learning the Lessons and Moving On¹ forges the entire essay.

Modernisation theory, the first main development theory of the post-World War II and decolonisation era, clearly reflects Cold War patterns and, as Ronaldo Munck put it, “was an expression of the then-hegemonic US imperialism” [Kirby: 1997, p. 45]. In the wake of the successful implementation of the Marshall Plan, the rest of the world should also be modernised and, by doing so, convinced to join the capitalist system. The Soviet Union, in turn, applied its “rubel diplomacy” to support several national liberation movements to get their share of the world. Unfortunately, the idiosyncrasies and special needs of development countries were not taken into consideration. Despite the fact that the modernisation ideas promoted by Durkheim, Weber, Parson, Rostow and McClelland do entail opportunities for general advancement, it is hard to imagine how they should have been compatible with societies predominantly based on a collectively oriented, rural socio-economic structure.

Nevertheless, I believe that even today some aspects of this theory could be partly recycled without sacrificing the traditional societal tissue; however, the idea that development can only be guaranteed through industrialisation would need to be discarded. Durkheim’s improvement-through-effort strategy - compared to the traditional allocation of tasks - and Weber’s idea of re-investing surplus are valuable attempts for improvement; if their application was strengthened at a collective level as opposed to an individual one, an additional potential for development could be set free. This brings us to McClelland’s need- for-achievement strategy which could be applied constructively in education if some of the typically North American values - such as individual competition and materialism - were replaced by values which carry a deeper meaning for humanity. Education remains key for human development and has the potential to roll back the alienation process many developing countries are currently going through.

The critics of modernisation theory correctly argue that the theory, as it was applied in the post-war era, was ethnocentric as well as elitist and therefore unrealistic and inappropriate to benefit the entire society of developing countries. It “successfully modernised” the elites, which exacerbated internal problems with regard to the class structure and intra-state racism.

Dependency theory was the natural counter-revolutionary theory stemming from the South (Chile) although André Gunder Frank, it’s most radical advocate, was educated in the capitalist system, which may explain some of his extremism and misconceptions of local conditions. As Frank admits much later, “de-linking has not been a very viable or fruitful policy.”² In the meantime, the Economic Commission for Latin America and the Caribbean (ECLAC/CEPAL) under Raúl Prebisch had started implementing new economic dependency-reduction measures such as the inward-looking import substitution industrialisation (ISI) and the proposal of regional common markets; those measures constituted the so-called “structuralist” approach because they focussed on the structural weaknesses of the economic system as opposed to Frank’s radical position of putting all the blame on external conditions. The main issue of a proper integration of developing countries into the world economic system remains valid until the present day partly because earlier attempts to reform the system, such as a New International Economic Order (NIEO), failed. Although Cardoso, a defender of some aspects related to dependency theory, argued that situations of dependency can be alleviated within capitalism, Brazil - despite its acceptable growth rates - still shows one of the highest figures of inequality world-wide and is still heavily indebted at the end of Cardoso’s presidency; weak democratic institutions and opposing interests both nationally and internationally are often the cause for the president’s incapability of implementing necessary reforms [MacDonald et al: 2000]. Dependency theory drew the world’s attention to the asymmetry of the international system (which is now partly taken up by anti-globalisation movements, non-governmental organisations and even - slowly but surely - by international financial institutions), but it had neither the strength to change it nor did it tackle internal structural problems such as inefficiencies properly.

In the academic literature, dependency theory is frequently described as being “intellectually misconceived”³. I would rather see it as a theory which recognised some of the main structural problems yet did not contextualise them properly and, as a consequence, did not find proper solutions. Additionally, the weak bargaining power of developing countries and the lack of international political will to strengthen them inhibited changes, which would have benefited the developing world.

After two opposing theories, one might expect an enlightened compromise but this was not the case. The neo-classical counter-revolution returned to the main tenets of modernisation theory due to the following reasons: Developing countries, drained by the debt crisis of the 1980s, did not have enough bargaining power to impose more beneficial conditions, nationalisation and inward-looking measures were not sufficiently successful, and the era of globalisation had set in bringing in its wake Reaganism and Thatcherism in form of a neo- liberal policy and structural adjustment programmes (SAPs). Once again, internal factors of inefficiency were in the limelight which in itself was not a bad move had it only been accompanied by equally rigid and demanding changes of the international system to finally implement just conditions for developing countries. The application or non-application of the Washington Consensus will be analysed at a later stage during one of the case studies.

However, it can already be stated that it entails certain dangers; structural reforms based on the broadening of the tax base is difficult in countries where a high percentage of the society lives under the poverty line and works in the informal sector; the privatisation of state enterprises can be particularly dangerous if it is done in an inappropriate way as in Cochabamba, Bolivia, where it originated a water war because inhabitants could no longer afford drinking water and were therefore driven to the streets;⁴+⁵ the securing of property rights has the potential to widen the digital divide even further unless excessive costs are avoided and they are made available to the informal sector.⁶ Direct social programmes to moderate the impact of similar programmes on the poor are called for.⁷

The term development itself can be interpreted in the most diverse ways. The commonly used definition - though not necessarily supported by many development agents - is the World Bank (WB) and International Monetary Fund (IMF) definition based on economic growth measured in terms of the increase of the gross domestic product (GDP) per capita. However, within the United Nations Development Programme (UNDP), other extra-economic factors such as life expectancy, adult literacy are taken into consideration. Besides, aspects of gender equality and the environment can be considered whereby it becomes more and more difficult to agree on common developmental goals since some of the aspects can cause contradictions. Sachs even argues, “it is not the failure of development which has to be feared, but its success” expressing the danger inherent in the westernised notion of “development” which causes an overvaluation of consumerism and the unsustainable exploitation of natural resources.⁸ For the sake of this paper, I will apply the understanding that the desire for development expresses the desire for more life choices, which is partly in line with the UNDP position, or as Amartya Sen termed it in his Nobel Prize-winning book, the desire for Development As Freedom.

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¹ Development Theory: Learning the Lessons and Moving On, Peter W. Preston, The European Journal of Development Research, June 1999, Vol. 11, No. 1, pp. 1 - 29

² Dependency Theory, Andrés Velasco, Foreign Policy, November/December 2002 (pp. 44 – 45)

³ Development Theory: Learning the Lessons and Moving On, Peter W. Preston, The European Journal of Development Research, June 1999, Vol. 11, No. 1, pp. 1 - 29

⁴ http://www.globalpolicy.org/socecon/tncs/2002/waterprivat.htm (accessed on December 15, 2002)

⁵ http://www.citizen.org/documents/Water%20Public%20Event%20Flyer%20Final2.pdf (accessed on December 15, 2002)

⁶ Democracy and the “Washington Consensus”, John Williamson, World Development, 1993, Vol. 21, No. 8, pp. 1329 - 1336

⁷ Effects of Liberalization Programs on Poverty and Inequality: Chile, Mexico, and Peru, John Sheahan, Latin American Research Review, 1997, Vol. 32, No. 3, pp. 7 - 38

⁸ After post-development, Jan Nederveen Pieterse, Third World Quarterly, 2000, Vol. 21, No. 2, pp. 175 - 191