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Underdevelopment theory and poverty

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Underdevelopment theory and poverty

The underdevelopment theory occurred because of objection of the modernization theory. The theory is mainly concerned with financial structures (Foster-Carter 1985, p1). It is equally evident that the theories of development were responses to decolonization process. Dependency theory was the main element of underdevelopment theory that arose after the disillusionment with the development of financial strategies. The underdevelopment theory focuses on the relationship between the advanced and undeveloped countries. Baran claimed that the modernization theory supported capitalism that kept the developing world backwards while the advanced world continued to acquire valuable resources and chances to obtain economic surplus. During the beginning of capitalism in the advanced world, the peasants and traders acquired capital rapidly. However, this did not happen in the colonized nations. This resulted into underdevelopment in the third world nations. The development theorists believe that the developing counties would escape underdevelopment if they had withdrawn from global capitalism (Harris 1989).
According to the underdevelopment theorist, the increase and persistency of poverty results from the influence of the financial and political system of developed countries. This implies that the emphasis of modernization on financial growth was unsuccessful. This is evident in the rising poverty rates and indebtedness of developing counties specially the African countries. The exposure to the economic and political systems of the advanced systems was referred to as modernization. The modernization perception was the model of development, which failed due to various reasons. One of the reasons is that it did not have vital ingredients, which included enough historical contribution and a structural incline. This implies that modernization is ethnocentric and fails to consider the fact that the wealth of evidence that the growth of the financial system cannot be summarized in simplistic concept. This is because the system of the traditional values cannot be substituted with the modern ones. The economic and political influence of the advanced states caused the increased the poverty level in developing countries because they were not structurally responsive to various vital factors (Sklair 1994, p 61). The factors included the introduction of the new technology and market systems in the current social relations. Additionally, the modern perspective ignored the lack of equality of power and social classes (Stiglitz 2002, P. 2). The economic and political influence of the advanced nations led to underdevelopment because it increased the dependence of the developing nations on the advanced ones. The gap between the financial status of the advanced and developing nations became wider because of dependence. The social economic stability of the advanced states was maintained while the workers and peasants in the developing countries became strained financially. The problem of underdevelopment can only be solved if the there can be the equal global redistribution of resources. It can also be solved if there can be essential alterations in the productive relations within the developing nations (Webster 1992, p 30). The dependence theorists claim that the impacts of the economic system of the advanced