The document discusses the evolution of international relations (IR) and development as disciplines, highlighting the shift from a state-centric perspective to one that includes social issues like poverty and inequality. It reviews historical and theoretical approaches to development, including modernization, dependencia, and the neoclassical revolution, while critiquing their limitations and outlining the emergence of new paradigms such as the post-Washington consensus. The text emphasizes the importance of institutions, governance, and diverse realities in contemporary development discourse.

1. Development
and International
Relations
BY GULSHAN KUMAR

2. Introduction
 International Relations (IR) as a discipline did not take sufficient account of
development for a long time and had little substantive to say about states at the
political as well as economic peripheries of the international system and even less
about poverty as well as inequality within them.
 “Development has been consigned to the realm of low politics, except when the
international order, as it has been constructed, is threatened.”
 IR has at times even denounced alternative approaches dealing with new issues,
such as poverty, race or the environment, as non-IR
 It is only recently that IR’s own diversity has reflected more and more the various
critical, postcolonial, and poststructuralist tendencies of development. The
discipline has changed over the last 15 years and has become less state-centric.

3. History of
Development
 Historical Shift: The concept of development
evolved from viewing history as cyclical to
understanding it as a linear progression.
 Enlightenment Influence: John Locke and Adam
Smith’s work, particularly "The Wealth of Nations"
(1776), linked economic growth with progress,
addressing issues of social order.
 Sociological Progress: Auguste Comte proposed
that human knowledge progresses through three
stages of thinking.
 Darwin and Social Darwinism: Darwin’s theory of
evolution and social Darwinism popularized the idea
of development as progress in mid-19th century
Britain.

4. History of
Development
continued….
•Marxist Theory: Karl Marx viewed economic
development as progressing through stages of
economic production.
•Colonial Economics: Initially, development referred
to exploiting resources in colonies, not to
industrialize them. It was focused on resource
extraction for the colonizing countries.
•Pre-WWII Usage: The term "development" wasn’t
commonly used before World War II.
•Industrialization Issues: In 19th century Great
Britain, development addressed the negative effects
of rapid industrialization, such as poverty and social
unrest.

5. Approaches
to
Development
Forefathers” of development and
then turn to three classic
approaches: Modernization,
Dependencia, Neoclassics
Critical trends in development in
practice: Poverty and inequality,
security and development as well
as the environment and
development.

6. Modernization
•Origins and Development: Modernization theory
builds on 1940s literature, particularly Rosenstein-
Rodan (1943), and posits that developing regions can
transform by following the developmental path of
already developed countries.
•Capital Accumulation: The theory emphasizes capital
accumulation (from domestic or international sources)
as crucial for initiating societal transformation.
•Stages of Development: Rostow (1960) identified five
stages of societal development, from traditional society
to high mass consumption, believed to be universally
applicable.
•Role of Elites and Investments: Investments and new
ideas from elites are seen as key to transitioning
traditional societies to modernity.

7. Modernization
Continues
•Enlightenment and Rationalization: The theory is tied
to Enlightenment ideals, stressing rationalization,
technology, and education.
•Cold War Context: Modernization theory emerged
during the Cold War as part of the ideological struggle
between capitalism and socialism, particularly regarding
rebuilding Europe and Japan post-WWII.
•American Response: It is often viewed as an "American
response" to underdevelopment, evident in initiatives like
the Bretton Woods institutions, the Truman Doctrine, and
the 1951 UN development program.
•Key Figures: Besides Rostow, other contributors included
Gabriel Almond, Myron Weiner, Karl Deutsch, Albert Otto
Hirschman, and Daniel Lerner.

8. Criticism
•Narrow Focus: Criticized for focusing too
narrowly on capital accumulation, which can lead
to instability (Olson, 1963).
•Teleological and Ahistorical: Seen as overly
evolutionist and failing to account for historical
differences between states (Tilly, 1975; Cardoso
and Faletto, 1979).
•Neglect of Social Issues: Criticized for not
addressing social issues adequately.
•Policy Advice: Conservative critics argue that the
policy advice for massive foreign aid was against
U.S. interests (Banfield, 1962; Morgenthau, 1962).

9. Dependencia
•Core Idea: Dependencia (Dependency Theory) argues
that Western imperialism did not foster economic
progress in developing countries but rather led to the
“development of underdevelopment” (Baran, 1957).
•Unequal Exchange: This theory highlights how
developing countries suffer from unequal exchange,
where the benefits of capitalist consumption in the
North come at the expense of producers and consumers
in the South (Emmanuel, 1972).
•Structural Lock-In: The rise of industrialized centers
led to a structural dependence of agrarian peripheries,
reinforcing exploitation and resource transfer from
South to North

10. Dependencia
Continues..
•Singer-Prebisch Thesis: This thesis asserts
deteriorating terms of trade for developing countries,
where prices for primary products from the South
decline relative to manufactured goods from the North
(Prebisch, 1950).
•Critique of Foreign Investment: Unlike
Modernization Theory, Dependencia views foreign
investments and integration into the global economy as
forms of exploitation rather than sources of growth.
•Historical Context: Developed in response to the
perceived failure of newly independent countries to
achieve the “take-off” predicted by Modernization
Theory, and skepticism towards Western development
paths.

11. Criticism
•Overestimated North-South Trade: Critics argue it
overemphasized the role of trade and failed to hold up
empirically (Larrain, 1989).
•Neglect of Internal Factors: Did not account for
internal barriers to development, such as rent-seeking
behavior by state classes (Elsenhans, 1981).
•Problematic Results of Isolation: Attempts to
dissociate from the international economy often led to
poor outcomes (Edwards, Esquivel et al., 2007).
•Failure to Adapt: The economic success of the Asian
Tigers, who shifted from ISI to export-led strategies,
challenged Dependencia's stance on non-integration
(Rhys, 2008).

12. Influence
and Legacy:
• Shift in Focus: Prompted development institutions to
address social issues more directly (e.g., the World
Bank’s “basic needs approach”).
• Continued Relevance: Remains influential in some
development discourses and frameworks in
developing countries.
• World Systems Theory: Wallerstein’s World Systems
Theory (1975) expanded on Dependencia, providing a
global perspective on economic inequality, dividing
the world into core, semi-periphery, and periphery.

13. Neoclassical
Revolution
•Neoclassical Revolution: Influenced by Friedrich von
Hayek and Milton Friedman, neoclassical economics
challenged the role of the state in development, arguing
that state intervention could be as problematic as
market failure.
•State vs. Market: Neoclassical theory posits that
political elites often exploit markets for personal gain
rather than the common good. Therefore, reducing the
role of government is seen as crucial for initiating
growth.
•Deregulation and Liberalization: This approach
found support in the policies of leaders like Margaret
Thatcher and Ronald Reagan, and was also advocated
by economists such as P.T. Bauer, Deepak Lal, Bela
Balassa, Ian Little, and Anne Krueger.

14. Neoclassical Continues…
Focus on Internal Factors: Neoclassical economists argued that underdevelopment was
due to internal factors in developing countries, such as poor governance and
macroeconomic instability, rather than external exploitation.
Criticism of ISI: Import Substituting Industrialization (ISI) was criticized for preventing
countries from exploiting their comparative advantages. Instead, countries should focus
on increasing exports and reducing inflation by liberalizing trade and financial flows.
Structural Adjustment Programs (SAPs): In response to the economic crises of the 1980s,
Bretton Woods institutions implemented SAPs aimed at reducing state intervention,
stabilizing economies, and integrating countries into the global market. This approach
was encapsulated in the “Washington Consensus” (Williamson, 1990).
Implementation in the South: Some developing countries, including Chile under
Pinochet, Ghana, Mexico, and India, adopted these policies, often under pressure from
elites or international institutions.

15. Criticisms:
•Debt Crisis and “Lost Decade”: Critics argue that SAPs
contributed to the debt crisis of the 1980s and a period of
stagnation in development, known as the “lost decade”
(Singh, 1992).
•Uniformity of Policies: SAPs were criticized for their one-
size-fits-all approach, which did not account for the diverse
conditions of developing countries, particularly in Sub-
Saharan Africa (Toye, 1993; Noorkabash and Paloni, 1999).
•Neglect of Infrastructure and Social Investment: The
focus on market liberalization often overlooked the need for
public investment in infrastructure and social services,
which are essential for private sector growth (Rapley,
2001).
•Lack of Institutional Theory: Neoclassical theory failed to
address the role of institutions beyond criticizing them as
rent-seeking entities. The approach was considered more
normative than its proponents acknowledged.

16. Legacy and
Evolution:
•Continued Influence: Despite criticisms, elements
of the neoclassical approach, particularly its focus
on markets and governance, continue to influence
development thinking and practice.
•Post-Washington Consensus: The mainstream has
shifted towards a “Post-Washington Consensus,”
emphasizing better governance, pro-poor growth,
and social safety nets, reflecting lessons learned
from the shortcomings of earlier neoliberal policies.
•Ongoing Relevance: Rational choice and public
choice theories remain influential, especially in
institutions like the IMF, though there is increased
focus on addressing governance issues and poverty
reduction.

17. Development
and Growth:
The
Contemporary
Mainstream
•Criticism of Neoliberalism: By the end of the 1980s,
criticism of neoliberal development policies intensified,
highlighting their limitations and negative impacts.
•Post-Washington Consensus: This period did not
produce a single new paradigm but rather led to a variety of
theoretical developments aimed at addressing a broader
range of issues in development.
•Diverse Realities: The reality of developing countries is
increasingly diverse, with stark contrasts between:
•Bottom Billion: Populations living in extreme poverty and
persistent misery (Collier, 2007).
•Emerging Economies: Countries like Brazil, India, and
China, which experience high growth rates and have
significant geopolitical influence.

18. Development
and Growth:
The
Contemporary
Mainstream
continues…
•Focus on State and Institutions: A growing
theoretical consensus emphasizes the importance
of understanding the role of the state and
institutions in development, moving beyond the
purely market-focused approaches of earlier
neoliberal policies.
•Theoretical Proliferation: The 1990s and early
2000s saw a proliferation of development theories
reflecting the complex realities of different
countries, rather than a unified new approach.

19. Statist
approaches
•Neglect of the State: Neoclassical approaches have been
criticized for neglecting the role of the state in international
politics and in the economic development of late-industrializing
countries (Skocpol, 1985).
•Role of Bureaucracy: Research, notably by Johnson on
Japan’s Ministry of International Trade and Industry (MITI), has
highlighted the importance of effective bureaucratic institutions
in successful economic development (Johnson, 1982).
•Statist Approaches: Studies of East and Southeast Asia
emphasize that strong, often repressive states were crucial to
their economic success (Amsden, 1989; Haggard, 1990; Evans,
1995; Wade, 2004).
•Developmental State Concept: The idea of the
"developmental state" was earlier recognized by Rosenstein-
Rodan in the 1940s and advocated by Gunnar Myrdal in the
1960s (Myrdal, 1968). This concept suggests that states play
an essential role in fostering economic development.

20. Neoinstitutionalist
Approach
•Focus on Non-Market Institutions: Neoinstitutionalism examines
the role of non-market institutions on economic behavior, contrasting
with both old institutionalism and statist perspectives.
•Rationalist Assumptions: Builds on rationalist assumptions, focusing
on individual logics and transaction costs as barriers to development.
•Institutional Characteristics: Growth is influenced by the
characteristics of institutions within a country. Effective institutions
are seen as essential for reducing uncertainty, fostering technological
progress, and attracting investment
•Importance of Property Rights and Rule of Law: Strong property
rights and rule of law are considered prerequisites for growth. Better
institutions correlate with less inequality and lower poverty levels.

21. Neoinstitutionalist
Approach
•Role of Informal Institutions: Besides formal institutions,
informal institutions and cultural factors, such as trust and
reciprocity, are also crucial for growth
•Historical Path-Dependency: Debates on how historical
factors, like early settlers and their impact on institutional
development, affect current economic outcomes.
•Democracy and Development: The relationship between
democracy and economic development is debated. Some argue
that democratization correlates with growth while others note that
initial growth may occur under autocratic. Current views suggest
that democratic consolidation, rather than democratization, is
linked to economic growth.
•Mainstream Thinking: Neoinstitutionalism dominates current
development thinking, emphasizing that there is no single optimal
institutional design for development (World Bank, 2002).
Countries are encouraged to find their own institutional paths
rather than relying on a universal best practice.