Fieldhouse - part III

I thought that readings would give me a headache but alas, it is the technology that is fighting with m. No idea how I was able to get to this point - random clicking works; let's see if I can do it again.

Fieldhouse - part III

In part III, Fieldhouse does return to the original argument between the optimists and the pessimists in explaining the West’s influence on the economic development on the rest of the world up until the 1960s. The author’s argument in the ensuing chapters revolves around two central themes: the comparative advantage and vent for surplus. One of the most important economic events that impacted the global economy as well as the economic integration was the financial crisis of the 1930s. As a closeted ‘optimist’ Fieldhouse elaborately explains how Latin America in particular developed through product diversification and manufacturing and exports, and thus appears to have benefited from the incorporation into the international division of labor, at least before 1929. An example of Argentina, which protected industrialization at the expense of agriculture (i.e., low prices paid for agricultural products in order to keep the food prices down in the cities), reminds of Russia after its revolutionary period and well into the 1920s where this practice was also implemented. Fieldhouse goes on to describe the Australian and New Zealand experience and the significance of their incorporation into the global economic system. He does not specifically emphasize the geographic location or the ethnic makeup of these colonies which could explain their economic success story, but instead claims that their main staple, wool, was the pillar of their economic development since it “remained the property of the original producer” (148). The question arises, which the author only briefly toys with, whether Australia was more dependent or more autonomous? It was an exclusionist society as the settlers did not find it imperative to share the benefits of economic integration into the world system with the native, economically undeveloped population. The case of New Zealand has weak theoretical support as the four sources Fieldhouse uses focus on different arguments.
The author is not very partial to Marxists and examines the interaction between imposed capitalism and the native society more closely (e.g., ‘articulation’ in Africa). His example of Ghana is presented in a way that it blames Ghana for not making the most of opportunities for wealth creation (exports, etc.). Fieldhouse also blames British colonialism for letting the economic forces guide the success or failure of the colonies’ economies. As Fieldhouse is unable to answer the key question he set out to answer (what were the benefits or disadvantages of a developing economy integrated into the international division of labor), he does conclude that a) as long as the colony was “able to develop viable export products, it benefited proportionately as much as any independent state” yet it had no freedom of choice and was ‘encouraged’ and ‘guided’ by the colonizer which product(s) to develop and export; and, b) “the impact of colonialism as a recruiting sergeant for the international division of labor appears to have been limited” as the general economic development trends were influenced more by international economy than imperial policy. Here Fieldhouse fails to see the logic that the empires were active participants and creators of the international economy that they helped shape, and therefore indirectly influenced the economic development of the colonies.
[Vocabulary: external trade coefficient – the ratio between trade and GDP]
[Vocabulary: cif and fob prices -Cost, Insurance and Freight (CIF) – An international trade term of sale in which, for the quoted price, the seller/exporter/manufacturer clears the goods past the ship’s rail at the port of shipment (not destination). The seller is also responsible for paying for the costs associated with transport of the goods to the named port at destination. However, once the goods pass the ship’s rail at the port of shipment, the buyer assumes responsibility for risk of loss or damage as well as any additional transport costs. The seller is also responsible for procuring and paying for marine insurance in the buyer’s name for the shipment. The Cost and Freight term is used only for ocean or inland waterway transport. Free On Board (FOB) – An international trade term of sale in which, for the quoted price, the seller/exporter/manufacturer clears the goods for export and is responsible for the costs and risks of delivering the goods past the ship’s rail at the named port of shipment. The Free On Board term is used only for ocean or inland waterway transport. (From: www.speedycargo.com/resource-center/cif-vs-fob)]
[Vocabulary: monopsony – buyer’s monopoly (From: www.dictionary.com)]