Acknowledgment

I would like to express my heartfelt gratitude and thank my teacher,Dr. Bibhuti Kalyan Mahakul,
for having faith in me and giving me this opportunity to work on the project, “Controlled Foreign
Corporations”. I would also like to thank my family and friends for their continuing support and
help when required. My gratitude also goes out to the staff and administration of HNLU for the
infrastructure in the form of our library and IT Lab that was a source of great help for the
completion of this project.

Taruna Shandilya
Semester – V
Roll No. - 180
Section – B
B.A.-L.L.B (Hons.)

1
 Declaration

I hereby declare that the project work entitled “Marxism, Dependency Theory and World System
Theory in International Relations” submitted to HNLU, Raipur, is record of an original work
done by me under the able guidance of Dr. Bibhuti Kalyan Mahakul, Faculty Member in
International Relations, HNLU, Raipur.

Taruna Shandilya

Section B

Roll No.-180

Semester V

2
 Table of contents

1. Acknowledgment....……………………………………………………………………1

2. Declaration…………………………………………….……………………………….2

3. Research objectives and Methodology….……………...………………………………4

4. Introduction…………………………………………………………………………….5

5. Chapterization:

 Chpt. 1: Marxism in International Relations....................................................6

 Chpt. 2: Dependency Theory: An Introduction................................................8

 Chpt 3: World Systems Theory......................................................................12

 Chpt.4:Dependency and World Systems Theory: Relation and

Differences…………………………………………………………..………..14

6. Conclusion………………………….………………………………………………...15

7. Bibliography….…………………………………………………………………….…16

3
 RESEARCH OBJECTIVES

1. To study the theory of Marxism and its principles in international relations.

2. To understand the theory of Dependency and its propositions.
3. To study the World Systems Theory in International Relations.

RESEARCH METHODOLOGY
The topic of study is “Marxism, Dependency Theory and World Systems Theory in International
Relations”. Given a study of this kind, a descriptive analytical method has been followed to carry
out the study.

Sources of data: Secondary sources of data have been used to carry out the study. These include
reports, research papers and news articles such as:

International relations online

https://internationalrelationsonline.com/international-relations-marxism/

4
 INTRODUCTION

International relations, the study of the relations of states with each other and with international
organizations and certain sub national entities (e.g., bureaucracies, political parties, and interest
groups). The most basic premise of international relations Marxism is the division of the world
based on economic status, rather than political motivations. Marxists theorize that it was the
wealthy capitalists who created the state system as a way to ensure their wealth would continue
to grow. From this basic premise, two separate international relations theories were established:
dependency theory and world-systems theory.

Dependency theory represents a major advance in the Marxist theory of imperialism.

Dependency provides a comprehensive analysis of the impact of capital penetration into the
Third World. World-Systems Theory is also based on the work of Karl Marx. World-Systems
Theory was made into a developed set of ideas by Immanuel Wallerstein. It is also referred to as
world-systems analysis or the world-systems perspective. World-Systems Theory shows
that capitalism is not just an economic system bounded by national borders highlighting class
inequality. World-systems theory is also a type of conflict perspective.

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 1. Marxism and International Relations

Marxism is a political and social theory that argues that social change comes about through
economic class struggle. Karl Marx and Friedrich Engels developed the theory in the 19th
century. Marxism formed the philosophical basis for the rise of communism in the early 20th
century. Important works include The Communist Manifesto and Das Kapital.

 Principles

Economics is a dominant factor that brings about change in the world according to Marxism.
This is an important distinction from other major theories in international relations, such as
realism and liberal internationalism, that stress the dominance of the political over the economic.

Importantly, class struggle is the impetus for social change according to Marxism. The theory
holds that history can be viewed as a series of class struggles where one social class oppresses
others. The oppressed classes eventually overthrow the oppressor class and a new social structure
arises with new oppressors and new classes being oppressed. Marx argued that the proletarian
class, or worker class, was being oppressed by the capitalists who acquired most of the value of
the proletarian work as profits for themselves, leaving workers with little.

Marxism predicts that the proletarian class will eventually revolt and overthrow their capitalistic
oppressors, eventually establishing a classless society based on socialism. In fact, the
philosophical basis of the communist movements and regimes of the 20th century, ranging from
the Soviet Union to Latin America to China and North Korea, is largely based on Marxism.
However, it's important to note that while Marxism supports a form of socialism, not all forms of
socialism are Marxist in nature.

Marx's original theory was pretty much focused on the internal dynamics of individual societies
rather than the world of international affairs. However, V.I. Lenin, one of the architects of the
Communist revolution in Russia, brought Marxism international in the early 20th century.1

1
Marxist theory: Definition and impact on politics
http://study.com/academy/lesson/marxist-theory-definition-impact-on-politics.html

6
One of the greatest real-world examples of Marxism was the introduction of this theory in the
USSR. In 1917, Vladimir Lenin led the October Revolution in the USSR, creating a workers’
state with the introduction of Marxism. He attempted to spread these ideas throughout the world,
stating that Marxism could not exist within one country alone. These attempts failed, however.
Lenin died before he saw Marxist ideas take hold, which widely took place after World War II.

With the end of the Cold War, Marxism lost much of its hold throughout the world. The ideas
that were introduced through this theory have been widely deemed obsolete, turning to other
international relations theories to establish balance in the world. Although this theory is no
longer widely used, it still contributes a great number of questions relating to international
relations, offering students and those working in this field much to consider.2

2
International relations online
https://internationalrelationsonline.com/international-relations-marxism/

7
 2. DEPENDENCY THEORY: AN INTRODUCTION

Dependency theory is based on a Marxist view of the world, which sees globalization in terms of
the spread of market capitalism, and the exploitation of cheap labour and resources in return for
the obsolete technologies of the west.  The dominant view of dependency theorists is that there is
a dominant world capitalist system that relies on a division of labour between the rich 'core'
countries and poor 'peripheral' countries. Over time, the core countries will exploit their
dominance over an increasingly marginalized periphery.

Dependency theory advocated an inward looking approach to development and an increased role

for the state in terms of imposing barriers to trade, making inward investment difficult and
promoting nationalization of key industries.

Dependency theory differs from most Western approaches to studying political development.
One difference is that this approach originated in the Third World (primarily Latin America),
rather than among Western academics. Third World dependency thinkers were concerned with
explaining the unequal and unjust situations in which they and their nations found themselves.
Third World countries were poor while "developed" countries were rich. Third World countries
had bad health conditions, while other countries had good health conditions. Third World
countries had little military power, while other countries had tremendous military resources.
Third World countries faced starvation, while citizens of other countries had to worry about
losing weight. Third World economies were monoproductive and agriculturally based, while
economies in developed countries were diversified and industrialized. By almost any
conventional socioeconomic measure, Third World countries were at the bottom of the scale.
They had less education, less wealth, poorer health, less military power, and were dominated
politically and economically by the first world. Dependency theorists asked why such
inequalities existed. Their central concern was to understand the causes of inequality. They felt
that such inequalities were unjust, and sought to explain inequalities in order to change them and
achieve their goal of increased equality among nations and peoples.

Dependency theory has always been quite controversial: it incorporates some Marxist concepts;
it addresses the sensitive issue of inequality, blaming inequality on the developed nations; and it

8
originates in the Third World. Some aspects of liberation theology and world systems theory are
related to dependency theory.3

 HISTORY:

Dependency theory has its roots in Karl Marx’s work on economic structuralism and the
economic relationships between economically rich and economically poor states. Karl Marx
argues that the world system and international relations are driven by economic power and
exploitation. Namely, the economically rich take advantage of the economically poor, through
their control of the economy. While they are looking to make profits for themselves, they are
doing so at the expense of the poor individuals and/or countries.

Thus, while Marxist thought is the foundational point of dependency theory, the more modern
formations of dependency theory can be traced back to the 1950s, to the work of Raul Presbisch.
Presbisch, in studying international relations and issues of development, with particular attention
to Latin American states, noticed something interesting. Namely, “Prebisch and his colleagues
were troubled by the fact that economic growth in the advanced industrialized countries did not
necessarily lead to growth in poorer countries. Indeed, their studies suggested that economic
activity in the richer countries often led to serious economic problems in the poorer countries.
Such a possibility was not predicted by neoclassical theory, which had assumed that economic
growth was beneficial to all even if the benefits were not always equally shared”.

And thus, because of the lack of explanation of this economic imbalance, and economic
conditions that arise when the rich states were getting richer, Prebisch looked to explain what
was happening. What he initially argued was that poor countries were sending their raw
materials to the Global North, who in turn would turn these into finished products, then sell them
back to the poorer states. These products were worth much more as finished goods, than they
were as unfinished products.4

3
Dependency Theory, POSC311:Politics of Developing Nations 
Spring, 1999
http://udel.edu/~jdeiner/depend.html
4
Dependency Theory, International Relations
http://internationalrelations.org/dependency-theory/

9
  MAJOR PROPOSITIONS OF DEPENDENCY THEORY

1. Third world countries do not exist in isolation. They can only be understood in the context of
the world economic and political system. Political events in third world countries are directly
related to events in first world countries. However, relations between first and third world
countries are asymmetrical. The flow of power and control is from the first world (center or core)
to the third world (periphery). Political and economic events in the first world have a huge
impact on the politics and economics of third world countries, but third world political and
economic events usually have little impact on the first world.

2. Within the world political and economic system there is a tremendous amount of interaction
among core countries and peoples, and between the core and the periphery. There is very little
interaction just among periphery countries. The consequences of this are great, resulting in an
isolated and weak periphery country having an unequal relationship with the united and strong
core.

3. Politics and economics are related. They cannot be understood apart from each other.
Economic ties and relationships between core and periphery countries are particularly important.
These are advantageous for the core, and disadvantageous for the periphery. Core-periphery
trading patterns result in continuous growth of political and economic power for the core at the
expense of the periphery. Economic trade causes a widening of the gap between developed and
developing countries, rather than a narrowing of that gap. Historically, lower priced raw
materials have been exchanged for higher priced finished goods.

4. Underdevelopment is not a natural state, but rather a condition that is caused. The fact is
that developed nations are actively under developing third world countries as a result of the
systems of interactions between them.

5. Put another way, the underdevelopment of weak third world countries is directly related to,
and makes possible, the "development" of the powerful countries of the industrialized core. Both
the center and the periphery are part of the world political-economic system, and neither would
exist without the other.

10
6. Furthermore, so long as capitalism remains the dominant world economic system, there is no
reason for the situation of developed and underdeveloped countries to change.
Underdevelopment is not a temporary condition, as had been thought in the past, but is a
permanent condition. In fact, if the present world system does not change we can expect the core
to become more powerful and the periphery weaker in the future. Rather than "catching up" to
the developed countries, most currently underdeveloped countries will fall farther behind.

Resources flow from the periphery to the center. The core profits at the expense of the periphery
as a result of the movement of products and resources. The passage of time does not bring a
growing equality within the country, but rather brings about an increasing gap between life in the
capital and that in the countryside. 8. In a sense, national leaders in the capital exploit the people
for their own personal benefit and power. Consequently, these "national" leaders could really be
conceptualized as agents of the international system. Their national power and prominence
derive from their international contacts.

11
 3. WORLD SYSTEMS THEORY

The roots of the World System Theory can be traced to the writings of Lenin. In his monumental
work, Imperialism-The Highest Stage of Capitalism, Lenin contended that imperialism created a
two-tier structure within the capitalism world economy. He defined the dominant structure as the
‘core’ and the less-developed structure as the ‘periphery’. It is the location of the states within
this capitalist world economy, which determines the patterns of interaction and relation of
domination and dependence between them. Galtung(1971) and Wallerstein(1974) further
developed this theory and provided powerful insights into the working of the world capitalist
economy. Among other proponents of this theory, the noteworthy were Andre Gunder Frank,
Raul Prebisch5 (1963), the first Executive Director of the United Nations Economic Commission
for Latin America, John Gallagher and Ronald Robinson 6 (1953), and Gunnar Myrdal7 (1957),
the author of Asian Drama.

The main line of argument of the World System theorists is that the dependency situation of the
developing countries is the direct result of the economic exploitation by the advanced countries.
They define the situation of dependency, as a “situation in which a certain number of countries
have their economy conditioned by the development and expansion of another…, placing the
dependent countries in a backward position exploited by the dominant countries”.

According to World-Systems Theory, capitalism must be seen as involving relationships among

nations and these relationships are based on inequality. Again, according to World Systems
Theory, those nations which developed capitalistic economies early then went on to dominate
other nations through colonialism and colonization or simply through linking the economies of
the nations in ways that favored the more dominant nation and placed the others into a condition
of dependency on the dominant nation. This state of dependency, according to World Systems
Theory, tended to hamper the development of the other economies. The world-system
perspective, indebted to Marxism, views capitalism as the engine of development in the modern
era, and sees society as bearing at least a peripheral relationship to capitalist expansion.

5
Raul Prebisch, Towards a Dynamic Development Policy for Latin America, United Nations, New York, 1963
6
John Gallagher and Ronald Robinson, ‘The Imperialism of Free Trade,’ Economic History Review, Vol. 6, No.1,
1952.
7
Gunnar Myrdal, Economic Theory and Underdeveloped Regions, Gerald Duckworth, London, 1957.

12
World-Systems Theory is a macro-scale approach to world history and social
change emphasizing that the world-system should be the primary unit of social analysis and
not nation states.8

Dependency theorists not only reflect upon the external factors like foreign states, MNCs,
international banks, multilateral lending institutions, foreign control of technology and an
international bourgeoisie as cause of dependency but also highlight the internal constraints on
development such as patterns of land tenure, social structures, class alliances, and the role of the
state. These internal factors strengthen and reinforce the instruments of foreign domination. As a
result of the interplay between these internal and external factors, the nature of development or
underdevelopment of society will vary.

With this line of thinking in mind, some of the World System theorists use Marxist terminology
and Leninist insights to explain this situation of dependency. Here the structural theories of
dependency of the two chief proponents will be discussed.9

The theory was devised as a theory of social change it has had an impact on world politics due to
its emphasis on the analysis of the world-system rather than individual actors in the international
system. In addition, the theory maintains that there is class distinction and a hierarchical system
in the world which are essential elements of Marxism. This makes the world-system a well
structured theory within the Marxist tradition.

8
World Systems Theory
http://sociologyindex.com/world_systems_theory.htm
9
World System Theory, International Relations, Peu Ghosh, Pg 37

13
 4. Dependency and World Systems Theory: Relation and
Differences

World Systems Theory focuses on a larger division of labor that takes places nationally,
regionally and internationally with countries occupying a "core," "periphery role" or a middle
ground semi-periphery. These roles can be mutual beneficial and the roles of a specific state can
change over time. Whereas Dependency Theory says the poor periphery countries are exploited
for the benefit of enriching core countries.  

World Systems acknowledges the exploitative nature in Capitalism but also recognizes that the
world isn't as binary as rich country vs poor country. Dependency Theory is a precursor of World
Systems, and while it is largely defunct as political theory, a lot of the basic ideas can be found
in more modern political and economic models.

The practical premises of both are the same, as one should expect given that world-systems
theory is essentially building on top of and with dependency theory. The differences are more in
the contexts of their development and the focus that each field does/did. Dependency theory was
in the context of the decolonization movement in Latin America and the debate happening at the
time over development policies like import-substitution; world-systems analysis was advanced as
a way to argue the importance of seeing the world as one large and integrated political-economic
system, as opposed to the more prevalent way of analyzing countries and regions as if they were
isolated actors separate from one another, or from a global system.

14
 CONCLUSION

A global capitalist system has always existed, and within this system, all elements have been
interrelated and interdependent. The economies of the world have been getting used to this; the
only innovation is the increasing awareness of these linkages. However, Marxist theorists insist
that the only way to discover how significant contemporary developments really are is to view
them in the context of the deeper structural processes at work.

Dependency and world systems theories share a common emphasis on global analysis and
similar assumptions about the nature of the international system and its impact on national
development in different parts of the world, but they tend to emphasize different political
dynamics. Dependency theorists tend to focus on the power of transnational classes and class
structures in sustaining the global economy, whereas world systems analysts tended to focus on
the role of powerful states and the interstate system.

15
 BIBLIOGRAPHY
 World System Theory, International Relations, Peu Ghosh

 Marxist theory: Definition and impact on politics

http://study.com/academy/lesson/marxist-theory-definition-impact-on-politics.html

 International relations online

https://internationalrelationsonline.com/international-relations-marxism/

 Dependency Theory, POSC311:Politics of Developing Nations Spring, 1999

http://udel.edu/~jdeiner/depend.html

 Dependency Theory, International Relations

http://internationalrelations.org/dependency-theory/

 Raul Prebisch, Towards a Dynamic Development Policy for Latin America, United
Nations, New York, 1963

 John Gallagher and Ronald Robinson, ‘The Imperialism of Free Trade,’ Economic
History Review, Vol. 6, No.1, 1952.

 Gunnar Myrdal, Economic Theory and Underdeveloped Regions, Gerald Duckworth,

London, 1957.

 World Systems Theory

http://sociologyindex.com/world_systems_theory.htm

16