DEPENDENCY AND UNDERDEVELOPMENT (A CASE STUDY OF NIGERIA)

CHAPTER ONE

INTRODUCTION

1.1. BACKGROUND OF THE STUDY

Nigeria, among the third world countries went through almost a century of colonial experience from 1861-2008, when she got her political independence. Since independence, Nigeria has been struggling in the course of political instability, economic and socio-cultural imbalances. And like other third world countries, the nation has been hugely confronted with underdevelopment which emanated from dominant exploitative character of the western economies on which those of the third world depend. The gap in income inequalities has widened, and perceptions of group marginalization have intensified youth's anger arising from unemployment and poverty, finds expression often in the violent ethno-religious conflicts, or in violent protests and criminal activities such as armed robbery, extortion and fraud. The atmosphere becomes perpetually tensed, laborious, charged, over-heated and characterized by violence (insurgency & counter-insurgency). More so, the nation's economy is suffering enormously owing to her main dependence on petroleum without economic diversification. "Dependency relates to a situation in which the economy of certain countries is conditioned by the development and expansion of the other to which the former is subjected’’ (Santos 2011). The relation of inter-dependence between two or more economies in a world trade terms, assumes the form of dependence when some countries (the dominant ones like the USA, Britain, Germany and France) can expand and be self-sustaining; while other countries (the dependent ones like Nigeria, Rwanda, Bolivia, Thailand and India) can do this only as a reflection of expansion which can have either a negative or positive effect on their immediate development". From the definition above, dependency, according to Santos is both bilateral and multilateral. It also explains or entails the existence of foreign and domestic inter-dependence i.e. two countries together with reasons to relate, again the relation leads to some conditioning effects on development policies of decision makers in a dependent society, and lastly, with this relationship inherently unequal being, are of the dominance and dependence (Santos, 2011, p 23). The basic assumption is that there is a dialectical relationship between development and underdevelopment. (Frank, 2010, p. 10) "Development and underdevelopment are two different sides of a universal historical process’’. He asserts that what causes underdevelopment in third world is as a result of what brought about development in Europe and America". This dependency concerns the centre which refers to the technologically advanced countries of the world and the periphery refers to the third world countries. It should be noted that the centre has a centre which refers to the urban areas of the world and the periphery which refers to the rural areas of the world. The periphery (third world countries) also has both the centre and the periphery. This simply refers to the "centre of the periphery and the periphery of the periphery". Centre of the periphery refers to the urban centre of the developing countries like Nigeria, while the periphery of the periphery refers to the rural areas of the developing country. This is a relationship where the centres of the developed countries dictate the terms of their co-existence economically, socially and politically. There is an exploitative and vertical relationship between the centre and the centre of the periphery which is subordinate to the centre. In this, the centre is assigned the role of manufacturing industrial products while the periphery produces primary goods-raw materials and needed resources; the periphery now depends on the centre for her economic survival and consumption of the already made products (foreign products). Succinctly put, this is an unequal relationship between the countries provided to be already at an advantage the (capitalists) and disadvantaged countries (third world countries like Nigeria) as a result of economic exploitation. It is against this backdrop that dependency and underdevelopment (a case study of Nigeria) is examined.

1.2. STATEMENT OF PROBLEM

The personal worth of any national government is the attainment of qualitative level of development as it is a crucial aspect of any nation’s drive to self-reliance. Lawal (2011) posited that development is a vital necessity to the growth and sustentation of any vibrant nation. Thus, for development to be ensured, socio-political and economic stability must be guaranteed at all levels of government as this will promote citizens natural attachment to the governing process. In as much as development is vital to any nation’s progress, Okereke & Ekpe (2013) observed that there has been an unequal level of development in the world and this has precipitated numerous scholarly debates and postulations explaining why some countries are more developed than others. Various administrations in Nigeria had during the past presented and attempted comprehensive plans which were geared towards achieving development in the state. These plans encapsulated programmes that were to enhance the general welfare of the citizens and the nation at large. In fact, development and growth has been government’s top priorities since the attainment of independence.  Despite all the development plans by the Nigerian government, a lot of setbacks has been encountered in the developmental process. Therefore the study dependency and underdevelopment (a case study of Nigeria) is examined.

1.3 RESEARCH QUESTIONS

1. What are dependency theory and Nigeria’s underdevelopment?
2. What are economic dependency and underdevelopment in Nigeria?
3. What is the impact of dependency on underdevelopment in Nigeria?
4. What are dependency and underdevelopment; Nigerian experience?
5. What is the relationship between dependency and underdevelopment in Nigeria?
6. What are the challenges of development in Nigeria/possible solution in Nigeria?

1.4 OBJECTIVES OF THE STUDY

The major aim of the study is to examine dependency and underdevelopment (a case study of Nigeria. Other specific objectives of the study include;

1. To examine dependency theory and Nigeria’s underdevelopment.
2. To examine economic dependency and underdevelopment in Nigeria.
3. To examine the impact of dependency on underdevelopment in Nigeria.
4. To examine dependency and underdevelopment; Nigerian experience.
5. To examine the relationship between dependency and underdevelopment in Nigeria.
6. To examine the challenges of development in Nigeria/possible solution in Nigeria.

1.5 RESEARCH HYPOTHESES

Hypothesis 1

H01:There are is no significant impact of dependency on underdevelopment in Nigeria.

H02: There is a significant impact of dependency on underdevelopment in Nigeria.

Hypothesis 2

H0: There is no significant relationship between dependency and underdevelopment in Nigeria.

H1: There is a significant relationship between dependency and underdevelopment in Nigeria.

1.6 THEORETICAL FRAMEWORK

DEPENDENCY THEORY

With utmost dissatisfaction with the modernization theory which did take into account the existence of international dependencies. This theory seeks to explain underdevelopment as a symptom and result of the continued dependence of the „inferior‟ or developing society on the „superior‟ or industrialized society which has over time weakened the internal factors of the developing society. In other words, the same relationship that developed the industrialized society, underdeveloped the developing society, thus as Kuhnen puts it, underdevelopment is not backwardness but intentional downward development. Dynamics external trade, economic factors, politicoeconomic interest and economic relations have been fingered as the root causes of dependence. Such other theories in this line of reasoning are Circular Deterioration of Terms of Trade (Prebisch), Immiserizing Growth (Bhagwati), Imperialism, Classical Imperialism (Luxemburg, Lenin), and Modern Imperialism (Santos, Galtung) theories. The theorists of dependency have put forth a conception that conceives of uneven levels of development among countries as being primarily the result of the appropriation of the wealth (or 'economic surplus') of one country by another. Here, uneven development is conceived of as the result of events in the realm of circulation, or exchange, the conditions of which are formed by an international market. The theoretical (and political) implication of this thesis is that "a people can free itself from the rule of capital, and thus regain control over their lives, by a mere improvement in the conditions of exchange or terms of trade” (Reece, 2013). According to this theory, the system of the capitalistic world causes a labour upheaval that damages the domestic economies of under-developed countries. It diminishes the economic growth rate and ends in the increased inequality of income. It also has a negative effect on the welfare of the majority of people. Further, since there is no basic equality in the goods that are processed and the exchanged raw materials, major and minor countries have been separated from one another more and more by the application of trade dependency. This has also caused a relatively long-term decrease in the price of primary goods compared with the prices of processed goods (Shareia, 2015). The poverty of an individual worker in Africa is a result of the exploitation of that particular individual by the system or the employer. Thus poverty at all levels is attributable to inhibiting relationships (internal colonialism) between the developed communities (urban areas) and their satellites (rural areas) and also between individuals with different economic powers. The relationship is one in which a metropolis or center exerts pressure upon its satellite or periphery (Matunhu, 2011-emphasis added). The basic message of dependency school is that the development of the metropolis was a result of the active underdevelopment of the non-metropolis communities. Put differently, the metropolis is dependent for its development on the underdevelopment of its satellite. For instance, human capital has flowed and continues to move away from Africa to the developed world… the white community achieved self- sustaining economic growth, while the black community grew only as a reflection of changes in the dominating economy. For instance in South Africa the enclave economy (affluent and connected to the global economy) determines the country‟s development path while the second economy (largely underdeveloped and disconnected from the global economy) is marginalised. The development of the second economy is constrained by human capital flight to the enclave economy (Matunhu, 2011).

MODERNIZATION THEORY

Modernization theory is an economic theory rooted in capitalism which evolved in the 1950s and 2008s. Modernization is a comprehensive theory which deals with the whole process a nation encounters in its attempts of transforming from a primitive to a modernized society. Modernization consists of a gradual process of specialization and separation of social structures, with the aim of promoting efficiency in the developmental process of any society. According to Roxborough (2011), modernization theory operates on economic oriented principles which posits that capital formation and investment are the major determinants of economic growth and development. Within the theory of modernization is the stage model which views development as a process which passes through various evolutionary phases. According to Ollawa (2008) the main focus of stage model is that development follows certain stipulated framework, as such, nations who seek to achieve economic growth must adhere to this framework. The most prominent scholar of the stage model is W.W. Rostow. For Rostow (2010), development is divided into five stages which are; the traditional society, the pre-condition for take-off stage, the take-off stage, the maturity stage, and the stage of high-mass consumption. The traditional stage is an agrarian society that is not aware of its capability to transform its society to a modern community. They are therefore not willing to take advantage of the potential of modern science and technology (Okereke & Ekpe, 2013). At the stage of precondition for take-off, the society becomes aware of its transformation potential and in turn gets involved in the application of modern science and technology to agricultural and industrial practices. The opportunity for investment and commerce therefore increases at this stage. The take-off stage places emphasis on the eradication of traditional obstacles which hinders economic growth and development. At this stage, the commercialization of agriculture is introduced and investment rises to a maximum level. The drive to maturity stage is a period when the economy shows the capacity to extend beyond the original industries that served as its pivot for take-off. The final stage of development is that of high mass consumption, it focuses on the production of durable consumer goods and services which is marked by a rise in real income (Okere & Ekpe, 2013). Implicit in the stage model is the assumption that some countries are developed because of their strict adherence to this evolutionary developmental process. The //psychological/Idiosyncratic theory is also another strand in modernization theory which attributes development to certain attitudinal personality variables. It is assumed that it is the innovative personality of a nation that stimulates economic growth and development (Okereke & Ekpe, 2013). Just like most theories, the theory of modernization has also encountered various criticisms. The stage model of modernization has been criticized on the basis that development does not follow strictly a particular motion. Thirwall (1985) argues that the stage theory establishes a rigid platform for development and also creates an impression that a nation can attain industrialization only when the agricultural sector has been modernized. His argument revolves on the fact that both agriculture and industries are to grow alongside each other if maximum development is to be achieved. The psychological theory of modernization has been criticized for being psychologically reductionist. It is argued that the theory employs psychological concepts to explain purely sociological problems (Okereke & Ekpe, 2013).