wisdom that economic development in Latin America is inevitably consis-
tent with US interests (Ray, 1973, p. 6). Its ‘militant critique’ of a highly
ideological developmentalism that ignored social classes and treated the
state as an instrument of popular will or the public interest, showed that
underdevelopment was not a ‘primal’ or ‘original’ condition. Dependency
theory ‘stimulated the empirical study of institutional and structural mech-
anisms of underdevelopment’ such as multinationals, fiscal policies, capital
expenditures and aid programmes (Leys, 1977, p. 93). It showed that capi-
tal does not necessarily break down non-capitalist modes of production, but
can bolster ‘archaic political and economic forms’ through alliances with
pre-capitalist social forces (Kay, 1975, p. 104).
Third World trends in the 1970s underlined the importance of under-
standing the limitations imposed by the international context, while at the
same time revealing some of the gross over-simplifications that formed part
of development theory’s conclusions. The two concerns at the core of
dependency theory – the limits on capitalist development at the periphery
and the relative importance of external and internal variables in determining
those limits – are of lasting significance. The core propositions of depend-
ency theory are now part of the conventional wisdom (Philip, 1990, p. 491).
Despite its weaknesses, dependency theory created a major opportunity for
the effects of integration in an international system to be analysed, includ-
ing those newly industrializing countries such as South Korea which might
be thought to undermine the dependency thesis (Bienefeld, 1980, pp. 5–10;
Godfrey, 1980, pp. 1–4).
Neo-colonialism and Dependency 107