Temat: Paper: Wallerstein’s concept of the capitalist...

General Information: explaining the concept

In order to make my paper more comprehensible, I presume it is vital to explain the concept of the capitalist world-economy. Wallerstein explained it as: “[...] the concept ‘world-economy’assumes that there exists an ‘economy’ wherever (and if but only if) there is an ongoing extensive and relatively complete social division of labor with an intergrated set of production processes which relate to each other through a ‘market’ which has been ‘instituted’ or ‘created’ in some complex way.” In other words, the system is based on interdependence. The interests of the countries are intertwined and necessary for mutual existance. Wallerstein adds that: “today, the entire globe is operating within the framework of this singular social division of labor we are calling the capitalist world-economy.” The world-economy is made up of core, periphery, and semi periphery. They are connected through international trade although their role within the system varies. Walter Goldfrank states that the system is integrated by the market not politics in a situation where states are interdependent on one another because of necessities like protection, fuel or food. In the field of politics, he says, the states compete for domination that is only temporary as a permanent one is not due to emerge ever. In 1974, Wallerstein gave his first definition of a world-system, which is a “multicultural territorial division of labor in which the production and exchange of basic goods and raw materials is necessary for the everyday life of its inhabitants.” From this definition we can draw a conclusion that there is a certain kind of symbiosis needed to keep the two sides ‘alive.’ In other words, core could not do without the periphery, and the other way around, as if compensating for each other. Of course, there is no question about which kind of state has more potential and capacity, and it is the core.
Core, Semi Periphery and Periphery
According to Goldfrank, the division of labor is referred to the relations and forces of production in the world economy leading to the creation of two interdependent regions- core and periphery. They are different in terms of geography and culture focusing on different types of production: periphery focuses on ‘labor-intensive’ and the core focuses on ‘capital-intensive.’ Theda Skocpol distinguishes one more kind of state- semi-periphery, having a mixture of activities and institutions applied in both kinds of states, core or periphery, and acting as a ‘buffer zone’ between them. Wallerstein argued that semi-peripheral states were exploited by the core as well as they were exploiters themselves of the peripheral countries. Paul Viotti and Mark Kauppi give a more detailed description of the three kinds of states. They point out:
The core areas historically have engaged in the most advanced economic activities:
banking, manufacturing, technologically advanced agriculture, and ship building. The
periphery has provided raw materials such as minerals and timber to fuel the core’s
economic expansion. Unskilled labor is repressed, and the peripheral countries are denied
advanced technology in those areas that might make them more competitive with core
states. The semi-periphery is involved in a mix of production activities, some associated
with core areas and others with peripheral areas. The semi-periphery also serves a number
of other functions such as being an outlet for investment when wages in core economies
become too high. Over time, particular regions of the world may gravitate between core,
peripheral, and semi-peripheral status.

Genarally speaking, we can say that core countries, like New Zealand, Switzerland or Germany are strong states with high wage workers and a diversified economy. What is more, they have democratic goverments. As far as semi-periphery states are concerned, like Greece, Panama, such countries are partly industrialized but having natural resources and engaged in international debt. As for peripheral countries, these are, I suppose, majorly African and South American countries. These can be characterized by the state of total dependence on the core, having extractive economies, such states are unstable countries needing a ‘stabilizer’ in the form of a strong ‘ally,’ meaning a core country. We can also add that those nations are very poor and their production is mainly meant for export. One of the characteristic features of this sort of state is a non-democratic government.
Martinez-Vela elaborates on the relationship between the core and periphery by saying that: “Among the most important stuctures of the current world-system is a power hierarchy between the core and periphery, in which powerful and wealthy ‘core’ societies dominate and exploit weak and poor peripheral societies.” He also adds that technology is the major factor determining the position of a state in core or periphery category. The more developed countries are the core, the less- the periphery. Viotti and Kauppi conclude that: “Third World underdevelopment and exploitation are central to maintaining the present structure of dominance in the world capitalist system.” It is the present world order and it is in the best interest of, at least, the countries in the north to keep the status quo the way it is now as they are the greatest beneficiaries in the situation. Chase-Dunn and Grimes state that countries in periphery are limited to the experience of that kind of development that causes their status to be subordinate. In other words, they are not allowed, by the core, to ‘go beyond’ that category. Skocpol explains that differential strength of the multiple countries in the system is essential in order to keep it as a whole as the stronger states strengthen and increase the flow of surplus, that is differential, to the core zone. Wallerstein called it ‘unequal exchange.’ Viotti and Kauppi elaborate that the weakness of the peripheral states is determined by the fact that they are not capable of controlling their own fate. It is, I suppose, in the best interest of the core countries not to allow it to happen in order to maintain their position and reduce the competitiveness of the peripheral countries. Viotti and Kauppi add that it is capitalism which determines the position of a country in the core periphery or semi-periphery category. It is important to note that Wallerstein, as a globalist, is often accused by his critics of having “reduced the derivation and operation of the state system to economics.”

Economy or politics?
Martinez-Vela directs our attention to the importance of looking at the World Systems Theory not only from economic but also from a political perspective. At this stage he defines two terms: imperialism and hegemony. He says that: “Imperialism refers to the domination of weak peripheral regions by strong core states. Hegemony refers to the existence of one core state temporarily outsrtipping the rest. Hegemonic powers maintain a stable balance of power and enforce free trade as long as it is to their advantage.” He also adds that hegemonic state of a country is only a temporary one because of “...class struggles and the diffusion of technical advantages.” Johan Galdung distinguishes four kinds of imperialism: economic, political, military, and communicative. He, to a certain extent, explains the behavior of peripheral states in a conflict by suggesting that peripheral states are obedient and tend to ‘copy’ the actions of the core state. For economic and political reasons those countries went to war following the U.S. Shackman points out that in the past there were different hegemons- in the 17th century it was the United Provinces, the United Kingdom was a hegemon in 19th century and the US becoming a hegemon in mid 20th century. He also adds that each in order to keep its hegemon status, the countries engaged themselves in “extended wars.” Shackman elaborates by stating: “Following the wars, the state then assumed its world responsibilities, of protecting and preserving the liberal order. The liberal trade arrangements, however, meant that spread of technology was easier, so that entrepreneurs from non-hegemon states could adopt the newest technology, and undermine the material base of productivity of the hegemon.” At this point it is worthy of consideration that Wallerstein recognized the importance of anarchy. Viotti and Kauppi remind that: “[...] anarchy simply refers to the absence of a superordinate or central political authority.” They also direct our attention to the fact that very often richer industrialized countries from the north are blamed for “virtually every Third World political, economic, and social problem [...] Lack of economic growth, social unrest, and repressive governments are all laid at the doorstep of the richer capitalist countries.” We can say, although it will be very general, that the core countries are mainly located in the north whereas in the south there are majorly peripheral nations. As far as the semi-peripheral states are concerned, they are in the north as well. Apart from those accusations, we can also speak of the feeling of resentment on the part of the peripheral states that causes various tensions, which may result in more or less serious conflicts.
Wallerstein directs our attention to the fact that the World System Theory deals mainly with the economy not politics. In order to support his view, he concludes: “The capitalist world-economy has, and has had since its coming into existence, boundaries far larger than that of any political unit.” We can draw a conclusion here that countries are, or may be, interdependent on one another no matter their political preferences. The states may not even be allies or friends, they are, however, linked together economically. I think that only a state of war or any other severe conflict could cut those economic relations as both/all countries are to some extent beneficiaries from this relationship. According to Wallerstein, it is the economy that should determine “the particilar distribution of power and capabilities.”
Wallerstein noticed that world system is unstable and undergoes certain cycles of over-production crises and recoveries. He explains:
As production is expanded in the individual search for accumulation, there regularly come
points where the amounts produced throughout the world-economy exceed the effective
demand resulting from the existing distribution of world income (as fixed by the
resolutions of prior acute sociopolitical conflicts). The consequent periods of stagnation
both reduce overall production and lead to class struggles which force a redistribution of
world income to lower strata within the world-economy.

In other words, as Shackman elaborates, “The redistribution expands the market, which leads to recovery from overproduction.” He also adds that: “the capitalist system expands, but at the expense of newly created periphery.” As far as almost the whole world is now included in the world system, the expansion of it soon will not be possible, according to Wallerstein this will occur “within the coming century.” While for Wallerstein technology is the most important factor for recovery occuring after an overproduction crisis, other scientists claim that apart from that also growth in knowledge is the source of general growth. Kuznets, for example, writes that a source of growth is “a high rate of accumulation of useful knowledge and of technological innovations derived from it.” Shackman gives an example writing that right after the WW II, the growth of Japan and Europe was fast in the 1950 which was due to the fact that there was a relative peace and stability following the war. It allowed the countries to “take advantage of newer technology, to rebuild, and so forth, in other words, to achieve high growth rates.” With time, however, he adds, their growth decreased as they caught up with their technological potential and not, as Wallerstein argued, because of problems in distributing the surplus. Chirot concludes that growth in the core states is determined more by internal structure than colonial possessions, to what he gives an example of Japan and Germany after WW II. There is some more criticism concerning the World System Theory and the way it is perceived by Wallerstein. For example, Arthur Stinchcombe accuses Wallerstein of presenting only those historical facts that seem to support his theory, neglecting the rest. He states that Wallerstein did not manage to show that the world in 17th and 18th century could by explained by his theory, as well as any other. Jacek Kochanowicz puts it best stating that Wallerstein created his thesis at a time when leftist interpretations towered above all others. He adds, however, that his theory was not analogical to real socialism in the Marxist way. Kochanowicz states that anyway the theory provided proposals of how to explain economic underdevelopment. Apart from political factors, the economic ones are also of huge importance, and I suppose here they played a crucial role. In some respect they are even more important. The semi- and peripheral countries may be invited to certain activities that would help the economies of all. Through ‘certain activities’ I understand various contracts of rebuilding the country after the conflict has been ended, closer military cooperation and investment connected with it. Not to mention things put out to tender. The possibility of winning the tender is greater on the side of the semi- or peripheral country as the work force in such states is less expensive. This factor is a great incentive that encourages poorer states to participate in international military or peace operations. Legro and Moravcsik even ask the question: “How much of alliance behavior can be explained by capabilities, geography, and technology and how much by state ‘intentions?’” V. Lenin notices that all the coalitions and alliances between countries are just a truce in times between wars. He adds: “Peaceful alliances prepare grounds for wars, and in their turn grow out of wars; the one is the condition for the other, giving rise to alternating forms of peaceful and nonpeaceful struggle out of one and the same basis of imperialist connections and the relations between world economics and world politics.” In other words, we can see that wars are needed to build alliances, which is probably due to the feeling of safety that all countries need to have. Countries in alliances feel safe because there is then a feeling of collective protection and might be more willing to solve problems militarily.
All in all, I think that Wallerstein’s theory of World System can be used to describe and analyze the world as it is today. As every theory it is full of shortcomings and opened up to criticism from various sides. The concept of the world-economy together with the concept of core, semi periphery and periphery is clearly seen as we look at the world now. The patterns according to which we are to classify a country into the appropriate category is quite clear. The theory showed how the situation changed in history, how states changed their position from the core status downgraded to peripheries and the other way around. It is true that countries are interdependent economically and that relationship is the most important for them no matter their political stand. I suppose this theory can be successfully used by a scientific analyst no matter his/her political views.












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author: Bartosz M. Kraszewski

American Studies Center, University of Warsaw