and appropriates it for its own economic development. The satellite remains
underdeveloped for lack of access to their own surplus’ (Frank, 1969a,
p. 33; see also Dos Santos, 1970). Far from experiencing development as a
result of ties with metropolitan centres (which is what modernization theory
tells us occurs), such ties hold the peripheral economy and society back.
The appropriation of surplus by foreigners occurred through ownership
(for examples, of mines) or a monopolistic buying power over products and
their sale elsewhere. Lower wages in peripheral economies also enable sur-
plus to be siphoned off to the centre (Emmanuel, 1972a; Amin, 1976;
Wallerstein, 1980). Foreigners owned or controlled facilities associated
with the export of surplus-generating goods – storage, transport and insur-
ance (Frank, 1969a, pp. 7, 18).
Frank was particularly critical of the idea that there was a clear demarca-
tion between backward and modern societies and that the histories of the
backward societies would move from stage to stage along a path leading to
modernity. He argued the reverse: that the condition of backwardness arises
from the subordination of poor countries to the development of today’s rich
countries. Modernization theory had ignored the effects of colonialism and
neo-colonialism on the histories of Third World countries. The explanation
of their backwardness could not be in terms of an earlier stage on the path.
The circumstances under which advanced countries progressed cannot be
repeated: ‘The now developed countries were never underdeveloped, though
they may have been undeveloped’ (Frank, 1966, p. 18; Chew and Denemark,
1996). Dependency is a continuing relationship, not confined to an imperial-
ist past but continuing in the neo-imperialist present. Formal political control
is not necessary for a relationship of dependency and exploitation to be
maintained through structures of foreign capital intervention.
A satellite within this hierarchical structure will only experience devel-
opment when its ties to the metropolis are weak: ‘no country which has
been firmly tied to the metropolis as a satellite through incorporation into
the world capitalist system has achieved the rank of an economically devel-
oped country’ (Frank, 1969a, p. 11). In Latin America the periods of
autonomous industrialization have occurred historically during periods
when trade and investment ties with Europe were loosened by European
wars and economic recessions. The same applies, according to Frank, to rel-
atively isolated regions within peripheral societies: the less integrated into
the world mercantilist and then capitalist systems, the greater the growth of
manufacturing and exports. The least developed and most ‘feudal-seeming’
regions are those which had the closest ties to the metropolis in the past. The
incorporation of a satellite into the metropolitan-led hierarchy chokes off
Neo-colonialism and Dependency 89