The Causes of Poverty in the Periphery

Abstract

In a recent article in this Journal, Vol. VII, No. 4, December 1970, on ‘Developing Countries and International Trade’, Leslie Stein attempts to provide an alternative explanation of the international relations between the developed and underdeveloped countries. He asserts that I argued, in my earlier discussion of ‘International Trade and the Developing Countries’ in Vol. VII, No. 2, July 1969, that the existing trade relations between the centre and the periphery are ‘a major cause’ of the latter's poverty. Consequently, I was led to recommend measures leading to less reliance on the external sector and, more specifically, a programme of ‘heavy industrialisation’. Since Dr Stein feels not only that my policy proposals are detrimental to the interests of the periphery, but also that the statistical findings and the theoretical discussions from which they are derived contain both errors and omissions, he is led to propose an alternative formulation of the international division of labour, which, in his view, benefits the periphery.