Structuralism: Is Latin America a success?

In the developing world, Latin American countries are among the best economic performers. This performance may be attributed to structuralism, which Latin America adopted during the 1950s, through the United Nations Economic Commission for Latin America (ECLAC) 

The structuralist view of economics takes it cue from the structuralist perspective, which employs the centre-periphery model and requires an appreciation of different historical structures. Structuralism implies that development is turned inwards, and, in a huge contrast to neoliberalism, the state has a role to play. 

As we observe, Latin America is performing well compared to its developing world colleagues. In fact, the United States has never belittled the economic potential of Latin America, and has always kept the region in tabs on its foreign policy. Large Latin American banks, such as the Banco Santander and the BBVA, operate inside the United States (the latter is even one of the biggest sponsors of the National Basketball Association). 

However, this outstanding economic performance is largely beset by escalating political instability (Latin America has been besieged by military coups since the beginning of the 20th Century), worsening peace and order situations (Mexico and Venezuela have the highest crime rates in the Western Hemisphere), and the widening gap between rich and poor. With these things in mind, I dare ask whether structuralism has actually worked in Latin America.

Economic structuralism takes its cue from an eponymous theory in anthropology, which states that “elements of human culture must be understood in terms of their relationship to a larger, overarching system or structure” (Blackburn, 2008). We can deduce from this definition that the structuralist approach emphasises the importance of taking into account structural features in doing economic analysis.

One thing that came to my mind in thinking why structuralism might have worked for Latin America is one thing – Latin American countries have mostly similar structures, politically and economically. This may have been brought about by a shared history and language.

However, did structuralism actually work?

During the last lecture, we talked about some problems that arose from structuralism. And all problems during one time or another were present in most Latin American countries. To make my point: despite richness in resources, most Latin American countries are still net importers of capital goods. Also, sometime during the 70s-80s industrial efficiency in Latin America are at low levels. Countries experienced high inflation; Bolivia even suffered from hyperinflation in the 70s-80s, while Ecuador had to abandon the Ecuadorian peso and is now trading using US dollars. Most Latin American companies are foreign-owned, and unemployment levels are still soaring.

 

On paper, structuralism is a good theory, but implementing it in real-life situations, especially the economy, is a daunting task. What might have caused Latin America’s failure in structural economics is the lack of political will to do so. Regime changes, intervention from foreign forces, and weak peace and order policing have made structuralism do more harm to Latin America than it supposed to do good.

 

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Concepts of Development: A Tale of East vs West

Throughout history the East and West have been in a constant battle of ideologies, culminating in the mid-20th century in the form of the Cold War.

But, as what we have discussed in class last Tuesday, both the East (or, more ‘appropriately’, the “Non-Western”) and West have different, and often contradicting, views on the concept of development. In general terms, the Non-Western concept of development is largely anchored on the notion of identity, place, and values; the human being is identified through his or her environment. In contrast, the self is a central, if not crucial, concept in the Western sense of development; moreover, the perception of modern development is individualistic and materialistic.

Familial relationships and its role in development
In the East, particularly in Asia and the Pacific Islands, the family is a very important unit in society and even in the formation of a person’s values and notion of culture. In my home country of the Philippines, most people are highly family-centred. Several tribes in Northern Luzon and in the southern island of Mindanao put a high value on families and clans. Even in cosmopolitan Manila, Sundays are reserved for family days – families going to church together and afterwards enjoy a walk in the park, a home-cooked meal, or an “eat-out” at the family’s favourite restaurant. Filipinos have even taken the importance of family to a whole new level: the wealthy families have dominated both the government and the corporate worlds. (I think we got this notion from China).

The “family-centric” concept that I grew up with is highly contrasting to what I have observed not only upon transferring to New Zealand but also from what I see in American, British, Australian, and Canadian movies. Once a person reaches the legal age (usually it’s 18), s/he is expected to move out of his/her parents’ home, otherwise s/he will be called a “failure to launch” (ooh I love this film!).

Now what has this got to do with the concept of development? A lot!

From what I understand based on last Tuesday’s lecture, Westerners believe that familial relationships could hinder development. Most Westerners I’ve talked to would always say that the prevalence of nepotism in both the government and the business sector in the Philippines have hindered national progress, since these families, who are viewed as still “feudal” and “backward”, would only have one thing in their minds: how to keep themselves in power. The family’s vested interests are put first at the expense of national development. Once I encountered a foreigner in Manila who told me that the Filipino’s strong emphasis on familial ties have prevented the rise of a breed intellectual managers and statesmen who could have strengthened the businesses and the Philippine economy, as well as led the nation towards economic growth.

However, Filipino business and political clans have always argued that the prevalence of nepotism in business and politics have actually contributed to national development. Growth was the product of a very important ingredient in Filipino families: trust. After all, why would one appoint in the first place an untrusted person to head one’s business?

Opposing views on land
Another point Westerners make against Non-Western concepts of development is how the Non-Westerners view land. After industrialisation swept the West, land is a commodity or a resource, whereas Non-Westerners have the notion that land is more than just a physical component of the Earth, but a part and parcel of the person (I suddenly remembered the Disney film Pocahontas and the specific line “You think you own whatever land you land on; the earth is just a dead thing you can claim. But I know every rock, tree, and creature has a spirit, a life, and a name”).

In the 1970s, the Philippine government under the leadership of President Ferdinand Marcos implemented the World Bank-funded Chico River Basin Development Project and the Cellophil Resources Corporation in the northern Cordillera provinces of Kalinga and Abra, which entailed the construction of four huge hydroelectric dams. These dams could have provided electricity for almost the entire Northern Philippines, but its construction would have flooded a large portion of the province that were mostly ancestral lands and traditional burial grounds of the Kalinga, Bontok, and Tingguian peoples. The government argued that the land was not titled, hence the government owned them. However, the tribesmen argued that their traditions dictate that they protect these lands at all costs. After months of facing determined and uncompromising resistance from the Kalinga, Bontok, and Tingguian peoples, the government was forced to discontinue the project. World Bank withdrew the entire funding for any project geared towards the development of the Northern Cordilleras.

As seen from the case of the Chico River Project, Westerners perceive land as a commodity that should be traded in order for economic growth to launch, whereas Non-Westerners view land as vital to the well-being of a community, and well-being, in turn, is vital in the development of their communities. As Karl Marx puts it, Westerners view land as something that has value after “being an object of utility”. 

In conclusion: where should we stand?
From a student viewpoint, I wouldn’t still be in a credible, if not correct, position to judge which concept of development is better.  As we see above, different concepts work because people around the world are diverse. Cultures and value systems differ from country to country. What works for the Philippines may not work for China, and altogether may not work for, say, Peru or Venezuela.

Studying these different concepts would help one assess critically what could work for the society which s/he will be working for. Furthermore, understanding the culture and the history of the country where a development project will be undertaken is essential in the success of a development project or policy.

But I should argue that development is always for the betterment of the people, and given this, the correct concept of development will always be the one that will answer the needs of the society.

See you later, Kolmogorov, Fisher, Bayes, and Chebyshev.

This week I have started my postgraduate diploma in Development Studies (which I plan to progress to Masters after a year) at Victoria. This field is totally new to me. After five long but fun years dealing with numbers, theorems, postulates, and formulae, I’m now dealing with praxis, policies, social theories, and the like.

One particular course I’m taking up this term is DEVE511, Development Theory, under Prof. John Overton. As I was leafing through the course outline one thing has struck me: most of the things I’ve talked about during my merry days in the universe of student politics back in the University of the Philippines that I have not gotten formal education about (neoliberalism, neostructuralism, etc.) are to be discussed in this course.

I’ve also noticed that this course is quite an agglomeration of political science, sociology, public administration, management, and policy studies. No formulae, no theorems, not my usual statistical stuff. Yep, I’m putting aside ANOVA, regression, probability, and the like, and focus first on modernization theories, dependency, sustainability, and participation.

I’ve started looking at some of the recommended texts and realized that some of them I’ve already encountered when I was training when I ran for the student council in UP.

Exciting! I’m looking forward to a deeper appreciation with several of these political and social theories, now seen through a development perspective.

So see you later, Kolmogorov, Fisher, Bayes, and Chebyshev.