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From dependency theory to the limits of neo-developmentalism (The Dialectics of Dependency in ‘Review of Radical Political Economics’)

The Dialectics of Dependency
By Ruy Mauro Marini
Edited by Amanda Latimer and Jaime Osorio. Translated by Amanda Latimer
228 pages / Paper $26.00 / 9781583679821

Reviewed by Louis O’Sullivan for Review of Radical Political Economics

First published in 1973, Ruy Mauro Marini’s Dialectics of Dependency is a key work by one of the main figures of Marxist dependency theory. Amanda Latimer has done a great service by finally translating it into English. She also provides a rich biography of Marini’s life as a revolutionary, academic, and journalist in Latin America during the great political conflicts and counterrevolutions of the latter part of the twentieth century. Latimer relates these experiences—which made Marini an exile three times over from his native Brazil, Mexico, and Chile—to his intellectual development, including concepts outside the scope of Dialectics, such as subimperialism.

A key proposition of Marini’s works, informed by his political activism, is that underdevelopment is not only imposed externally but (re)produced by the national bourgeoisie, who therefore should not form any part of revolutionary class alliances. Latimer’s biography also details his personal and professional connections with other key figures in Marxist dependency theory, particularly Vânia Bambirra and Theotônio dos Santos, and Andre Gunder Frank. Jamie Osorio, a former colleague of Marini, provides a prologue and chapter of commentary that critically explores Marini’s arguments and their relevance today.

Dialectics should have been translated in the previous century. Nevertheless, Latimer’s translation comes at an appropriate time, coinciding with the revival of interest in dependency theory in the Global North and an increasing problematization of recent development experiences in the Global South. Even among some mainstream circles there is growing recognition of the failure of economic growth in the Global South—when it has occurred—to deliver populations from poverty or facilitate the transition to the kind of industrialized, high-consumption national economies considered typical of early development in the North (see, e.g., Atolia et al. 2018). In fact, much of the South has seen a combination of deindustrialization and deagrarianization in the last few decades, alongside the persistence of high poverty and informal labor rates. As Osorio notes, “neo-developmentalism” is reaching limits in a similar way that classic developmentalism reached its limits in the 1950s and 1960s—an original impetus of dependency theory. Marini offers insights for these apparent paradoxes familiar to the Monthly Review School but makes a theoretical advance in arguing that the extension or intensification of absolute surplus value production in the periphery is integral to the development of industry and relative surplus value production in the core. In Marx, absolute surplus value refers to the extension of the working day beyond necessary labor time; the additional hours are surplus labor time that produces surplus value. Relative surplus value refers to the change in proportion between necessary and surplus labor time in a given working day achieved by reducing the value of wage goods, primarily by increasing labor productivity, and so reducing socially necessary labor time (devaluing labor power). The shift to industrial mass production in Europe was characterized by a transition to production based on increasing relative surplus value by producing wage goods more and more cheaply through the progressive improvement of productive and technical conditions.

Marini adds that Latin America contributed to this transition in Europe by providing cheap foodstuffs and industrial inputs. Cheap food directly reduced the value of the wage goods of the rapidly expanding industrial proletariat in the core, and thus the value of labor power. Meanwhile, as industrialization advanced and the value composition of capital rose, the rise in relative surplus value due to productivity gains was actually hurting profit rates—since these are measured against money advanced for both constant and variable capital. Expanding production of industrial inputs by Latin America helped Europe’s transition by reducing the cost of constant capital, and so eased the translation of greater rates of surplus value into greater rates of profit.

For Marini, this early development of capitalism, which proceeds according to the general laws of motion of capital identified by Marx, establishes particular features in the peripheral economy that lock in this asymmetric international division of labor—unequal exchange and the attempts of peripheral capitalists to compensate for it through superexploitation. Unequal exchange results from the simple fact that the core has a monopoly on the most advanced industrial goods, which enables them to exchange these goods at prices persistently above their value. Peripheries thus must cede part of the surplus value of their own goods by paying these higher prices for industrial goods. One way to overcome this unequal exchange would be to break the core’s monopoly on industrial goods, as advocated by structuralists like Raúl Prebisch. Many dependency theorists criticized this proposal, focusing on the concrete obstacles to peripheral industrialization including technological monopolies, financial constraints, and the difficulties of import-substitution industrialization (ISI) in the context of limited domestic demand. But Marini contributes a theoretical advance by arguing that peripheral capitalists compensate for unequal exchange in the sphere of circulation by increasing surplus value in the sphere of production through superexploitation.

Marini defines superexploitation as the remuneration of labor power below its real value. He argues this can occur through three mechanisms: an increase in the intensity of labor (to the point of exhaustion and premature death); the extension of the working day beyond normal limits; and the payment of wages below the value of labor power. Each mechanism deprives labor power of the ability to reproduce itself—in the first two cases through physical exhaustion, in the third case by providing a wage insufficient to cover a worker’s consumption needs. Labor power is thus not compensated at its value. The effect of superexploitation from the capitalist point of view is to increase surplus labor time (and thus the rate of surplus value) without reducing the value of labor power through productive development (as occurs in the core). This increase in the rate of surplus value allows capitalists in the periphery to compensate for the surplus value they lose through unequal exchange.

The resort to superexploitation is possible because the market for peripheral economies is in the core—peripheral capitalist classes do not rely on domestic incomes to realize the value of their commodities. There is thus a split between the spheres of production and circulation of commodities in peripheral economies, which Marini calls the “dependent cycle of capital.” In core economies, the worker is both a producer and consumer of industrial goods, and the tension between these roles (the need to exploit workers but also have them purchase goods) both drives and is ameliorated by the growth of relative surplus value—the progressive reduction of the value of wage goods through productivity improvements. There is thus a considerable complementarity between the accumulation of capital and the expansion of the domestic market in the core economies that doesn’t obtain in the periphery.

Superexploitation militates against developmentalist attempts at industrialization in the periphery since worker incomes must necessarily be depressed, depriving the periphery of the internal market necessary to support domestic industrial production. Marini notes that as the peripheral economy grows, the richest strata can possess sufficient incomes to support the limited industrial production of some luxury goods, as seen in early- to mid-century ISI. This particularly receives impetus from the closure of imports through global wars or crises and the need of core economies to offload outdated capital goods. However, the incomes of those wealthy groups depend on the continued superexploitation of labor in the export sector, precluding the emergence of a mass market for domestically produced industrial goods. The break between the production and circulation of commodities in the dependent cycle of capital thus persists. A further period of industrial development in the periphery can be discerned in the outsourcing of the lowest rungs of production to the periphery, where multinational corporations benefited from superexploitation of peripheral labor to boost their declining profit rates. This industrialization notwithstanding, the cycle of capital remains dependent: production is based on the maximization of absolute surplus value through superexploitation to export to the world market, precluding the transition to an economy centered on relative surplus value. As such, the core’s monopoly on the highest stages of production, and the unequal exchange this implies, remains unchallenged.

The similarities here with Samir Amin’s (1974) model of introverted and extroverted accumulation are striking. The fundamental difference lies in the centrality Marini assigns superexploitation in the transition to relative surplus value production. Since Amin locates the problem of underdevelopment fundamentally in circulation (extroversion), he advocates a transition to a model of introverted accumulation through delinking from the world market. By contrast, Marini locates underdevelopment in the productive sphere, arguing that superexploitation or the intensification of absolute surplus value in one part of the world is a necessary component of the production of relative surplus value elsewhere: the two are in a dialectical relationship. Accordingly, as Osorio notes, any shift in the periphery to industrial production more centered on relative surplus value—by delinking or otherwise—necessarily implies the growth of absolute surplus value production through superexploitation elsewhere. Thus if we assume, for the sake of argument, that China’s industrial rise represents a shift to more relative surplus value-oriented production there, it has also contributed to the reprimarization and growth of superexploitation in other parts of the periphery, including large East Asian economies such as Indonesia.

The concept of superexploitation is perhaps even more controversial in Marxist debates than unequal exchange because it is that most unique commodity, labor power, which is proposed as systematically violating the law of value. Furthermore, in superexploitation the unequal exchange is taking place within rather than between national social formations. In justifying this supposed heresy, Marini has two broad defenses. The first is a reference to a passage in Marx which acknowledges that the violation of the law of value takes place in the real world. The more substantive point, however, is that Marini is taking the laws of capital identified by Marx and arguing that their very extension (over the globe) and development generates new determinations that may conflict with these laws in dialectical fashion. Dialectics and its postscript also respond to some other criticisms. For example, to the objection that superexploitation is present in the core and so cannot form the basis of dependency, Marini responds that the issue is the preponderance of superexploitation rather than its mere existence, since this is what alters the cycle of capital in the dependent economy.

There nevertheless remain other inconsistencies in the concept of superexploitation. For example, it is difficult to see how an increase in the intensity of labor—and so the increase of the quantity of commodities produced in a given time—does not correspond to a reduction in socially necessary labor time, particularly in agricultural export economies (since the goods with a use value necessary to reproduce labor power are now produced in a shorter time period). Likewise, it is unclear how an increase in the intensity of labor corresponds to remunerating labor power below its value. Marini seems to argue that the increased intensity of labor, by leading to premature death, essentially transfers gratis time to the capitalist, thus increasing surplus labor time.

However, it is unclear why capitalist production should be viewed from the perspective of a worker’s life span rather than the ability of a worker to produce the value of their labor power in a shorter period at work. Nor is it clear how increasing the intensity of labor would hinder the expansion of a domestic market for industrial goods.

This leads me to agree with Osorio that superexploitation is best thought of in terms of the third mechanism, where workers receive wages below the value of their labor power. This mechanism is the most theoretically coherent and, as Osorio observes, is highly visible in the world today. One interesting example might come from Lin Chun’s observation that in China, rural migrant labor can be paid inadequate wages owing to their codified rural land assets with which they support their families and later life (Chun 2021: 132–33).

One notable absence from Marini is the concept of rent. As scarce strategic raw materials for the contemporary global economy are concentrated in the periphery, their rents might offer an avenue for peripheries to neutralize the loss of value through unequal exchange without resort to superexploitation and the limits it places on domestic market expansion. Likewise, the essay pre-dates discussions of unequal ecological exchange, though it is easy to see how unequal degradation of the ecological basis of (human) life in the periphery could accord with the concept of superexploitation. Finally, having been written in 1973, Dialectics’s account of finance
in terms of capital imports and foreign loans is insufficient for an analysis on how today’s international financial relations reproduce economic dependency, particularly through macroeconomic distortions in the periphery. An extension of Marini’s approach to these issues would be most welcome.

The Dialectics of Dependency: Ruy Mauro Marini

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