The economist Dos Santos defines dependency as a condition in which the economy of certain nations is conditioned by the development and expansion of another economy. Dominant nations expand and develop independently, while dependent nations grow only as a reflection of this expansion, which can have either positive or negative effects on their direct development.<br /><br />Types of Dependency<br />Dos Santos categorizes dependency into three main types:<br /><br />Colonial Dependency:<br /><br />Foreign capital controls the core sectors of colonial economies by monopolizing trade.<br />Financial-Industrial Dependency:<br /><br />Foreign capital dominates the production of raw materials and agricultural goods in colonized nations.<br />Technological-Industrial Dependency:<br /><br />Multinational corporations establish industries in underdeveloped nations to meet local market demands under the Import Substitution Strategy.<br />Key Scholars of Dependency Theory<br />Prominent figures in dependency theory include:<br /><br />Dos Santos<br />Frank Gunder<br />Paul Baran<br />Immanuel Wallerstein<br />Samir Amin<br />Raúl Prebisch<br />Prebisch introduced the Core-Periphery Theory in 1950 through the United Nations Economic Commission for Latin America and the Caribbean (ECLAC). He analyzed how global development relationships, while appearing complementary, ultimately favor developed nations over developing ones. His perspective was based on the structural differences between the capitalist elite in core nations and those in peripheral countries.<br /><br />Factors Sustaining the Global Economic Gap<br />Dependency theory explains the persistence of economic disparity between developed (core) and developing (peripheral) nations due to several factors, including:<br /><br />Peripheral countries’ reliance on foreign capital and the export of economic surplus to core nations.<br />Dependence on foreign technology.<br />Deteriorating trade terms for peripheral economies.<br />Socio-cultural colonial legacies that hinder economic independence and self-sufficiency.<br />Source: Economics of Development – Dr. Ali Hatem Al-Quraishi