Transcript Chapter 2 - People Server at UNCW

Chapter 2
Comparative Politics: Structures and Choices 2e
By Lowell Barrington
Economic Class, Development, Systems
and Globalization
Learning Objectives
 Define key terms such as class, economic
development, and globalization.
 Describe the social and cultural changes
that accompany economic development.
 Discuss globalization, its role in economic
development, and whether it helps or hurts
the poor around the world.
Learning Objectives (cont’d)
 Describe the class structures, level of
economic development, role of the
government in the economy, and degree of
globalization in the Topic in Countries cases.
 Explain the arguments that globalization (1)
strengthens states, (2) weakens states, or
(3) has mixed effects.
Class and Class Structure
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Class – many definitions
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an individual’s wealth and/or income
occupation, status, property ownership,
and the resulting relationships people have
a large group of individuals with
comparable social and economic attributes
and, as a result, broadly similar lifestyles
and future life chances
Mode and Means of Production
Class and Class Structure
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Class
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Working class
Middle class (old and new)
Upperclass
Underclass
Measuring Class and Poverty
Class Structure
THINK AND DISCUSS
If class structure is related to inequality,
how can some countries, including the
United States, have such a large
middle class and yet such high levels
of wealth concentration?
Class and Class Structure
 Class Consciousness and Its Decline
 Individuals become aware of their location in a
particular class,
 Develop a sense of solidarity, and
 Deem important the relationship between their
class and other classes.
THINK AND DISCUSS
In the United States, to what extent is a
person’s class determined at birth by the
class of the family? To what extent is class
the result of effort? How representative is
the United States on this point compared
with other countries around the world?
Economic Development
 Economic Growth and Prosperity
 GDP, GDP per capita, and GDP per capita-PPP
 Human Development Index (HDI)
 Types of Countries Based on Economic
Development
 Economically developed countries (EDCs)
 Lesser developed countries (LDCs)
 Least developed of the lesser developed countries
(LLDCs)
 Newly industrialized countries (NICs)
CITS and Emerging Markets
 Countries in transition (CITs)
 The post-Communist states
 Some see them as justifying their own
development category
 Emerging markets
 The LDCs and CITs most desirable to foreign
investors
 Include the “Topic in Country” cases of Brazil,
Russia, India, China and South Africa (BRICS)
Economic Development
 The “Resource Curse”
 The tendency for developing countries to focus on
extracting only certain valuable resources while
ignoring broader economic development
 Seen in many oil producing countries, including
Nigeria
The Economic System:
Government Involvement in the
Economy
 Free Market Capitalism
 Capitalism - based on private ownership of property
with business and economic activity taking place
within the market
 Free-market capitalism - minimal government
regulation of the economy and little social welfare
spending
 Socialism
 Opposite of ideal free-market capitalism
The Economic System:
Government Involvement in the
Economy
 Mixed Systems
 Labor-led capitalism
 Welfare state
 State-led capitalism
 Private ownership and individual decision making
 Mercantilism
 Economic Globalization
 Foreign direct investment (FDI)
TOPIC IN COUNTRIES
The United Kingdom
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Visible class differences, more identify as
working class than in the United States
Highly developed economically, most
prosperous TIC case
Largely capitalist with significant social welfare
protections
Less economically globalized (esp. less global
trade) than one would think
TOPIC IN COUNTRIES
Germany
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Large middle class, different class structures
between its east and west
Comparatively late and rapid industrialization;
impressive post-WWII growth
Social market economy (SME) – capitalist with
a conservative corporatist welfare state
Like UK, trade is limited and concentrated with
other European Union states
TOPIC IN COUNTRIES
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India
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Large lower class underclass; significant
inequality; middle class small compared to those
of EDCs but continuing to grow
Variable growth since independent, but recent
growth rates are impressive
Privatization is controversial, special economic
zones spawn debate
Low levels of economic globalization, but
command of English among many in the
population makes increased globalization likely
but there are political constraints
TOPIC IN COUNTRIES
■ Mexico
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Visible middle class; sharp divisions between
wealthiest and poorest
Emerging market; success tied to oil prices; north
more prosperous than south
Economy has a moderate level of government
involvement. Drug violence in country limits
growth.
Levels of globalization have improved since
NAFTA
GLOBALIZATION, WEAK STATE
VERSUS STRONG STATE THEORIES,
AND THE CASE OF MEXICO’S
ADOPTION OF NAFTA
■ The “Race to the Bottom”
□ Weak state theories contend that globalization limits
states’ abilities to tax, spend, and regulate
□ Result is a “race to the bottom” to attract
multinational corporations
■ Mixed results in the case of Mexico and its
adoption of NAFTA in 1994
TOPIC IN COUNTRIES
■ Brazil
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Emerging middle class, but severe economic
inequality
Rapid economic growth post-WWII, then
downturn; debt crisis in the 1980s
Massive public debt ties Brazil to the IMF and its
policies, widespread corruption exists
Significant trade barriers limit economic
globalization
TOPIC IN COUNTRIES
■ Nigeria
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Vast majority of population lives in extreme
poverty, very small middle class
Per capita, one of the poorest countries in the
world; vulnerable to oil price fluctuations
Economy is free-market, but far from ideal
Economically globalized because of oil-related
FDI, but political instability impacts its economy
IN THEORY AND PRACTICE
NIGERIA AND DEPENDENCY
THEORY
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Nigeria and Dependency Theory
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Dependency theory is a challenge to
modernization theory
It contends that LDCs are kept poor by EDCs
through LDCs’ dependence on EDCs
Predicts continuation of poverty, corruption,
and fragile democracy (at best) in LDCs
■Appears
to work well in explaining the
case of Nigeria
TOPIC IN COUNTRIES
■ Russia
□ Small middle class; small but visible upper
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class (“new Russians”) since 1990s
Economic collapse in late Soviet and early postSoviet periods, dependent on high price of oil for
GDP growth
Economy is fragile and dependant on oil profits
Capitalism operates along with state power,
political shakedowns are common
Limited globalization; inefficient industry hindered
by corruption and weak “rule of law”
TOPIC IN COUNTRIES
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China
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Noticeable economic inequality; urban areas
much wealthier than rural; small but growing
middle class
Significant growth since 1970s; per capita
statistics well behind those of EDCs
Retains state intervention in the economy
Relatively high levels of economic globalization;
has yet to encourage “political globalization”
IN THEORY AND PRACTICE
MODERNIZATION THEORY AND
ITS APPLICATION TO CHINA
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Modernization Theory
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Modernization theory contends that economic
development follows stages, LDCs can use EDCs
as a model, and economic development has social
and political consequences.
Theory is supported by development in the NICs in
recent decades
Theory predicts future consequences,
including democratization, for China
Modernization Theory
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Emerges from two idea sources
 Weber’s idea of “traditional versus modern”
 Spencer’s idea of “Social evolution” in which societies evolve in stages of
increasing complexity
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Combined into a theory of the stages of growth
 All societies alike in the traditional stage and would come through the same
set of changes that had led the west to the modern stage.
 Rostow articulates the theory of economic takeoff – in which self sustained
growth involved 5 stages of development from traditional to modern:
 Traditional – agricultural, non technological
 Pre-conditions for take-off – external demand for raw materials initiates
economic change; commercial agriculture develops; technology emerges; social
structures begin to change; individual social mobility begins to occur; national
identity developed (idea of shared economic interest)
 Take-off – leading manufacturing sectors increase rationalization and scale of
operations for domestic and export markets; secondary producers expand
(textiles are usually first).
 Drive to maturity – industrial base diversification, transportation infrastructure
expansion, social structure investment.
 Modern – urban industrialized – age of mass consumption. The industrial base
dominates the primary sector (ag), consumers able to afford high value goods
(cars), consumers have additional income beyond what is necessary for needs.
TOPIC IN COUNTRIES
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Iran
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Middle class, particularly in urban areas; large and
class-conscious working class and underclass
High birthrate not matched by economic
development; struggles due to Iran-Iraq War in
1980s
Government is reducing its role in regulation, but
economic reform is slow, investment in the energy
sector is needed
Scored lowest in globalization of the 72 countries
ranked by A.T. Kearney