The world-systems theory (also known as the world-systems analysis[1]) is a multidisciplinary, macro-scale approach to world history and social change.[1][2]
The world-systems theory stresses that world-systems (and not nation states) should be the basic unit of social analysis.[1][3] World-system refers to the international division of labor, which divides the world into core countries, semi-periphery countries and the periphery countries.[2][3] Core countries focus on higher skill, capital-intensive production, and the rest of the world focuses on low-skill, labor-intensive production and extraction of raw materials.[4] This constantly reinforces the dominance of the core countries.[4] Nonetheless, the system is dynamic, and individual states can gain or lose the core (semi-periphery, periphery) status over time.[4] For a time, some countries become the world hegemon; throughout last few centuries, this status has passed from the Netherlands, to the United Kingdom and most recently, the United States.[4]
The most well-known version of the world-system approach has been developed by Immanuel Wallerstein in 1970s and 1980s.[2][5] Wallerstein traces the rise of the world system from the 15th century, when European feudal economy suffered a crisis and was transformed into a capitalist one.[5] Europe (the West) utilized its advantages and gained control over most of the world economy, presiding over the development and spread of industrialization and capitalist economy, indirectly resulting in unequal development.[3][4][5]
Wallerstein's project is frequently mis-understood as world-systems "theory," a term that he consistently rejects.[6] For Wallerstein, world-systems analysis is above all a mode of analysis that aims to transcend the structures of knowledge inherited from the 19th century. This includes, especially, the divisions within the social sciences, and between the social sciences and history. For Wallerstein, then, world-systems analysis is a “knowledge movement”[7] that seeks to discern the “totality of what has been paraded under the labels of the… human sciences and indeed well beyond."[8] “We must invent new language,” Wallerstein insists, to transcend the illusions of the “three supposedly distinctive arenas” of society/economy/politics.[9] This trinitarian structure of knowledge is grounded in another, even grander, modernist architecture – the alienation of biophysical worlds (including those within bodies) from social ones. “One question, therefore, is whether we will be able to justify something called social science in the twenty-first century as a separate sphere of knowledge.”[10][11]
Significant work by many other scholars has been done since then.[3]
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World-system theory traces emerged in the 1970s.[1] Its roots can be found in sociology, but it has developed into a highly interdisciplinary field.[3]
World-system theory was aiming to replace the modernization theory.[2] Wallerstein criticized the modernization theory due to:
Three major predecessors of world-system theory are: the Annales school, Marxist, and dependence theory.[2][3] The French Annales School tradition (represented most notaby by Fernand Braudel) influenced Wallerstein in focusing on long-term processes and geo-ecological regions as unit of analysis.[2] Marxist theories added its stress on social conflict, the capital accumulation process and competitive class struggles, focus on a relevant totality, the transitory nature of social forms, and a dialectical sense of motion through conflict and contradiction.[2] World-system theory was also significantly influenced by dependency theory - a neo-Marxist explanation of development processes.[2]
Other influences on the world-system theory come from scholars such as Karl Polanyi and Joseph Schumpeter (particular, from their research on business cycles and the concepts of three basic modes of economic organization: reciprocal, redistributive, and market modes, which Wallerstein reframed into a discussion of mini-systems, world-empires, and world-economies).[2]
Overall, Wallerstein sees the development of the capitalist world economy as detrimental to a large proportion of the world's population.[5] Similar to Marx, Wallerstein predicts that capitalism will be replaced by a socialist economy.[2]
World-system thinkers include Samir Amin, Giovanni Arrighi, Andre Gunder Frank, and Immanuel Wallerstein with major contributions by Christopher Chase-Dunn, Volker Bornschier, Janet Abu Lughod, Thomas D. Hall, Kunibert Raffer, Theotonio dos Santos and others.[3] In sociology, a primary alternative perspective is world polity theory as formulated by John W. Meyer.
World systems theory builds on but also parts from the proposition of dependency theory. Fernando Henrique Cardoso described the main tenets of the dependency theories as follows:
Dependency and world system theory propose that the poverty and backwardness of poor countries are caused by their peripheral position in the international division of labor. Since the capitalist world system evolved, the distinction among the central and the peripheral nations has grown.
In recognizing a tripartite pattern in division of labor, world-systems analysis criticized dependency theory with its bimodal system of only cores and peripheries.
The most well-known version of the world-system approach has been developed by Immanuel Wallerstein, who is seen as one of the founders of the intellectual school of world-systems theory.[2][5]
Wallerstein notes that world-systems analysis calls for an unidisciplinary historical social science, and contends that the modern disciplines, products of the 19th century, are deeply flawed because they are not separate logics, as is manifest for example in the de facto overlap of analysis among scholars of the disciplines.[1]
Wallerstein offers several definitions of a world-system. He defined it, in 1974, briefly, as:
| “ | "a system is defined as a unit with a single division of labor and multiple cultural systems."[13] | ” |
He also offered a longer definition:
| “ | "…a social system, one that has boundaries, structures, member groups, rules of legitimation, and coherence. Its life is made up of the conflicting forces which hold it together by tension and tear it apart as each group seeks eternally to remold it to its advantage. It has the characteristics of an organism, in that it has a life-span over which its characteristics change in some respects and remain stable in others. One can define its structures as being at different times strong or weak in terms of the internal logic of its functioning."[14] | ” |
In 1987, Wallerstein's, defines world-system as:
| “ | "...not the system of the world, but a system that is a world and which can be, most often has been, located in an area less than the entire globe. World-systems analysis argues that the units of social reality within which we operate, whose rules constrain us, are for the most part such world-systems (other than the now extinct, small minisystems that once existed on the earth). World-system analysis argues that there have been thus far only two varieties of world-systems: world-economies and world empires. A world-empire (examples, the Roman Empire, Han China) are large bureaucratic structures with a single political center and an axial division of labor, but multiple cultures. A world-economy is a large axial division of labor with multiple political centers and multiple cultures. In English, the hyphen is essential to indicate these concepts. "World system" without a hyphen suggests that there has been only one world-system in the history of the world."[1] | ” |
Wallerstein characterizes the world system as a set of mechanisms which redistributes resources from the periphery to the core. In his terminology, the core is the developed, industrialized part of the world, and the periphery is the "underdeveloped", typically raw materials-exporting, poor part of the world; the market being the means by which the core exploits the periphery.
Apart from these, Wallerstein defines four temporal features of the world system. Cyclical rhythms represent the short-term fluctuation of economy, while secular trends mean deeper long run tendencies, such as general economic growth or decline.[1][3] The term contradiction means a general controversy in the system, usually concerning some short term vs. long term trade-offs. For example the problem of underconsumption, wherein the drive-down of wages increases the profit for the capitalists on the short-run, but considering the long run, the decreasing of wages may have a crucially harmful effect by reducing the demand for the product. The last temporal feature is the crisis: a crisis occurs, if a constellation of circumstances brings about the end of the system.
In Wallerstein's view, there have been three kinds of societies across human history: mini-systems or what anthropologists call bands, tribes, and small chiefdoms, and two types of world-systems - one that is politically unified and the other, not (single state world-empires and multi-polity world-economies).[1][3] World-systems are larger, and ethnically diverse. Modern society, called the "modern world-system" is of the latter type, but unique in being the first and only fully capitalist world-economy to have emerged, around 1450 - 1550 and to have geographically expanded across the entire planet, by about 1900. Capitalism is a system based on competition between free producers using free labor with free commodities, 'free' meaning its available for sale and purchase on a market.
World-system theory asks several key questions:
Some questions are more specific to certain subfields; for example, Marxists would concern themselves whether the world-system theory is a useful or unhelpful development of Marxist theories.[3]
World-systems analysis argues that capitalism, as a historical social system, has always integrated a variety of labor forms within a functioning division of labor (world-economy). Countries do not have economies, but are part of the world-economy. Far from being separate societies or worlds, the world-economy manifests a tripartite division of labor with core, semi-peripheral, and peripheral zones. In core zones businesses, with the support of states they operate within, monopolize the most profitable activities of the division of labor.
There are many ways to attribute a specific country to the core, semi-periphery, or periphery. Using an empirically based sharp formal definition of "domination" in a two-country relationship, Piana in 2004 defined the "core" as made up of "free countries" dominating others without being dominated, the "semi-periphery" as the countries which are dominated (usually, but not necessarily, by core countries) while at the same time dominating others (usually in the periphery), and "periphery" as the countries which are dominated. Based on 1998 data, the full list of countries in the three regions—together with a discussion of methodology—can be found.
The late 18th and early 19th centuries marked a great turning point in the development of capitalism in that capitalists achieved state-societal power in the key states which furthered the industrial revolution marking the rise of capitalism. World-systems analysis contends that capitalism as a historical system formed earlier, that countries do not "develop" in stages, but rather the system does, and these events have a different meaning as a phase in the development of historical capitalism; namely the emergence of the three ideologies of the national developmental mythology (the idea that countries can develop through stages if they pursue the right set of policies): conservatism, liberalism, and radicalism.
Proponents of world-systems analysis see the world stratification system the same way Karl Marx viewed class (ownership versus non-ownership of the means of production) and Max Weber viewed class (which, in addition to ownership, stressed occupational skill level in the production process). The core nations primarily own and control the major means of production in the world and perform the higher-level production tasks. The periphery nations own very little of the world's means of production (even when they are located in periphery nations) and provide less-skilled labor. Like a class system with a nation, class positions in the world economy result in an unequal distribution of rewards or resources. The core nations receive the greatest share of surplus production, and periphery nations receive the least. Furthermore, core nations are usually able to purchase raw materials and other goods from noncore nations at low prices, while demanding higher prices for their exports to noncore nations. Chirot (1986) lists the five most important benefits coming to core nations from their domination of periphery nations:
According to Wallerstein, the unique qualities of the modern world-system include its capitalistic nature, its truly global nature, and that it is a world-economy that has not become politically unified into a world-empire.[3]
Throughout the history of the modern world-system there has been a group of core nations competing with one another for access to the world's resources, economic dominance, and hegemony over periphery nations. Occasionally, there has been one core nation with clear dominance over others.[4] According to Immanuel Wallerstein, a core nation is dominant over all the others when it has a lead in three forms of economic dominance over a period of time:
Military dominance is also likely after a nation reaches these three rankings. However, it has been posited that throughout the modern world-system, no nation has been able to use its military to gain economic dominance. Each of the past dominant nations became dominant with fairly small levels of military spending, and began to lose economic dominance with military expansion later on.[17]
Historically, cores were found in the north-west Europe (England, France, Holland), although later in other parts of the world (ex. the United States).[4][5]
Historically, peripheries were found outside Europe, for example in Latin America.[5]
Semiperiphery nations are those that are midway between the core and periphery.[5] They tend to be countries moving towards industrialization and a more diversified economy. Those regions often have relatively developed and diversified economy, but are not dominant in international trade.[5] According to some scholars, such as Chirot, they are not as subject to outside manipulation as peripheral societies; but according to others (Barfield) they have "periperial-like" relations to the core.[3][18] While in the sphere of influence of some cores semiperipheries also tend to exert their own control over some peripheries.[5] Further, semi-peripheries act as buffers between cores and peripheries,[5] thus "partially deflect the political pressures which groups primarily located in peripheral areas might otherwise direct against core-states" and stabilize the world-system.[3][4]
Semi-peripheries can come into existence both from developing peripheries, and from declining cores.[5]
Historically, an example of a semi-periphery would be Spain and Portugal, who fell from their early core position, but still manage to retain influence in Latin America.[5] Those countries imported silver and gold from its American colonies, but then had to use it to pay for manufactured goods from core countries such as England and France.[5] In the 21st century, nations like China, India, Brazil and South Africa are usually considered semi-periphery.
External areas are those that maintain their own economic systems are not integrated with the world economy.[5]
Before the 16th century, Europe was dominated by feudal economies.[5] European economies grew from mid-12th to 14th century, but from 14th to mid 15th century, they suffered from a major crisis.[4][5] Wallerstein explains this crisis as caused by:
As a response to the failure of the feudal system, Europe embraced the capitalist system.[5] Europeans were motivated to develop technology to explore and trade around the world, using their superior military to take control of the trade routes.[4] Europeans exploited their initial small advantages, which led to an accelerating process of accumulation of wealth and power in Europe.[4]
Wallerstein notes that never before had an economic system encompassed that much of the world, with trade links crossing so many political boundaries.[5] In the past, geographically large economic systems existed, but were mostly limited to spheres of domination of large empires (such as the Roman Empire); development of the capitalism enabled the world economy to extend beyond individual states.[5] International division of labor was crucial in deciding what relationships exists between different regions, their labor conditions and political systems.[5] For classification and comparison purposes, Wallerstein introduced the categories of core, semi-periphery, periphery, and external countries.[5] Cores monopolized the capital-intensive production, and the rest of the world could only provide labor and raw resources.[4] The resulting inequality reinforced existing unequal development.[4]
According to Wallerstein, there have only been three periods in which a core nation has dominated in the modern world-system, with each lasting less than one hundred years. In the initial centuries of the rise of Europe, Northwest Europe constituted the core, Mediterranean Europe the semiperiphery, and Eastern Europe and the Western hemisphere (and parts of Asia) the periphery.[4][5] Around 1450, Spain and Portugal took the early lead when conditions became right for a capitalist world-economy. They lead the way in establishing overseas colonies. However, Portugal and Spain lost their lead primarily due to becoming overextended with empire building. It became too expensive to dominate and protect many colonial territories around the world.[17][18][19]
The first nation to gain clear dominance was the Netherlands in the 17th century, after their revolution led to a new financial system many historians consider revolutionary.[17] An impressive shipbuilding industry also contributed to their economic dominance through more exports to other countries.[15] Eventually, other countries began to copy the financial methods and efficient production created by the Dutch. After the Dutch gained its dominant status, the standard of living rose, pushing up production costs.[16]
Dutch bankers began to go outside of the country seeking profitable investments, and the flow of capital moved, especially to England.[17] By the end of the 17th century, conflict among core nations increased as a result of the economic decline of the Dutch. Dutch financial investment helped England gain productivity and trade dominance, and Dutch military support helped England to defeat the French, the other country competing for dominance at the time.
In the 19th century, Britain replaced the Netherlands as the hegemon.[4] As a result of the new British dominance, the world-system became relatively stable again during the 19th century. The British began to expand all over, with many colonies in the New World, Africa, and Asia. The colonial system began to place a strain on the British military, and along with other factors, led to an economic decline. Again, there was a great deal of core conflict after the British lost their clear dominance. This time it was Germany, and later Italy and Japan providing the new threat.
Industrialization was another ongoing process at that time, resulting in the diminishing importance of the agricultural sector.[5] In the 18th century, England was Europe's leading industrial and agricultural producer; by 1900, only 10% of England's population was working in the agricultural sector.[5]
By 1900, the modern world-system was much different than it was 100 years earlier. Most of the periphery societies had already been colonized by one of the older core nations.[15] In 1800, the old European core claimed 35% of the world's territory, but by 1914 it claimed 85% of the world's territory.[17] Now, if a core nation wanted periphery areas to exploit as had done the Dutch and British, these periphery areas would have to be taken from another core nation. This is what Germany, and then Japan and Italy, began to do early in the 20th century. The modern world-system became geographically global at that time, and even the most remote regions of the world have all been integrated into the global economy.[3][4]
While these countries were moving into core status, so was the United States. The American civil war led to more power for Northern industrial elites, who were now better able to pressure the government for policies favorable to industrial expansion. Like the Dutch bankers, British bankers were putting more investment toward the United States. Like the Dutch and British, the U.S. had a small military budget compared with other industrial nations at the time.[17]
The U.S. began to take the place of the British as the new dominant nation after World War I.[4] With Japan and Europe in ruins after World War II, the U.S. was able to dominate the modern world-system more than any other country in the history of the world-system.[4] After World War II, the U.S. accounted for over half of the world's industrial production, owned two-thirds of the gold reserves in the world, and supplied one-third of the world's exports.[17] However, since the end of the Cold War, the future of the US hegemony has been questioned and according to some scholars its hegemonic position has been in decline for a few decades.[4] By the end of the 20th century, the core of the wealthy industrialized countries was composed of Europe, but also some other countries, such as United States or Japan.[4] The semiperiphery comprised many states that have been long independent, but did not achieve Western levels of influence, and poor, former colonies of the West formed the periphery.[4]
World-system theory has attracted criticisms from its rivals; notably for being too focused on economy and not enough on culture, and for being too core-centric and state-centric.[3]
According to Wallerstein himself, critique of the world-system approach comes from four directions: from the positivists, the orthodox Marxists, the state autonomists, and the culturalists.[1] The positivists criticize the approach as too prone to generalization, lacking quantitative data and failing to put forth a falsifiable proposition.[1] The orthodox Marxists find the world-system deviating too far from orthodox Marxist principles, such as not giving enough weight to the concept of social class.[1] The state autonomists criticize the theory for blurring the boundaries between state and businesses.[1] Further, the positivists, the orthodox Marxists and the state autonomists argue that state should be the central unit of analysis.[1] Finally, the culturalists argue that the world-system theory puts too much importance on the economy and not enough on the culture.[1] In Wallerstein's own words:
| “ | "In short, most of the criticisms of world-systems analysis criticize it for what it explicitly proclaims as its perspective. World-systems analysis views these other modes of analysis as defective and/or limiting in scope and calls for unthinking them."[1] | ” |
One of the fundamental conceptual problems of the world system theory is that the assumptions which define its actual conceptual units are social systems. The assumptions which define these need to be examined as well as how they are related to each other and how one changes into another. The essential argument of the world system theory is that in the sixteenth century a capitalist world economy developed which could be described as a world system.[20]
The following is a theoretical critique concerned with the basic claims of world system theory: "There are today no socialist systems in the world-economy any more than there are feudal systems because there is only one world system. It is a world-economy and it is by definition capitalist in form." (Wallerstein 1979)[20]
Robert Brenner has pointed out that the prioritization of the world market means the neglect of local class structures and class struggles: "They fail to take into account either the way in which these class structures themselves emerge as the outcome of class struggles whose results are incomprehensible in terms merely of market forces." (Brenner 1982)[20] Robert Brenner: Director of the Center for Social Theory and Comparative History at UCLA
Another criticism is that of reductionism made by Theda Skocpol. She believes the interstate system is far from being a simple superstructure of the capitalist world economy: "The international states system as a transnational structure of military competition was not originally created by capitalism. Throughout modern world history, it represents an analytically autonomous level of transnational reality-interdependent in its structure and dynamics with world capitalism, but not reducible to it." (Scokpol 1979)[20] Theda Scokpol: American Sociologist and Political Scientist at Harvard University
New developments in world-system research include studies on the cyclical processes,[21] the consequences of the dissolution of the Soviet Union, the roles of gender and the culture, the environmental and subsistence issues, studies of slavery and incorporation of new regions into the world-system, and the precapitalist world-systems.[3]
Wallerstein traces the origin of today's world-system to the "long 16th century" (a period that began with the discovery of the Americas by West European sailors and ended with the English Revolution of 1640).[3][4][5]
Janet Abu Lughod argues that a pre-modern world system extensive across Eurasia existed in the 13th Century prior to the formation of the modern world-system identified by Wallerstein. Janet Abu Lughod contends that the Mongol Empire played an important role in stitching together the Chinese, Indian, Muslim and European regions in the 13th century, before the rise of the modern world system.[22] In debates, Wallerstein contends that her system was not a "world-system" because it did not entail integrated production networks, but was instead a vast trading network.
Andre Gunder Frank goes further and claims that a global-scale world system that includes Asia, Europe and Africa has existed since the 4th millennium BCE. The center of this system was in Asia, specifically China.[23] Andrey Korotayev goes even further than Frank and dates the beginning of the World System formation to the 10th millennium BCE, connecting it with the start of the Neolithic Revolution in the Middle East. According to him, the center of this system was originally in West Asia.[24]
Wallerstein's theories are widely recognized throughout the world. In the United States, one of the hubs of world-system research is at the SUNY Binghamton, at the Fernand Braudel Center for the Study of Economies, Historical Systems and Civilizations.[2][3] Most important publications are the Journal of World Systems Research, and the Review published by the Fernand Braudel Center.[2][3] American Sociological Association has a section on Political Economy of the World System.[2]