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  5. Finance and Dependency in Latin America and the Caribbean
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Finance and Dependency in Latin America and the Caribbean

Paper Session

Sunday, Jan. 5, 2025 10:15 AM - 12:15 PM (PST)

The Marker Union Square San Francisco, Bogart
Hosted By: Union for Radical Political Economics
  • Chair: Francisco Perez, University of Utah

The Rise and Fall of Caribbean Dependency Theory

Francisco Perez
,
University of Utah

Abstract

Growing efforts to reform the institutions regulating international finance and trade has led to a resurgence of interest in structuralism and dependency theory. The Caribbean tradition of dependency, however, has been relatively neglected. We describe the emergence of dependency thinking and the seminal work of W. Arthur Lewis in the late colonial years in the West Indies, the mounting criticism by more left-wing thinkers of the limits to import substitution and foreign investment and the debates around the proposed New International Economic Order, and the decline in popularity of dependency theory in the 1980s as the “lost decade” foreclosed more ambitious development agendas. We argue that Caribbean Dependency theorists' greater focus on the external financial constraints facing small, open economies and their typology of colonial regimes distinguishes them from their Latin American counterparts and makes them particularly relevant for addressing contemporary challenges in the Global South.

Super-Exploitation of the Labor Force in the Periphery within a Global Pool of Workers: Are Periphery-Specific Phenomena Persistent in the Financial Capital Era?

Debora Nunes
,
Monmouth University

Abstract

This paper explores the concept of super-exploitation of the labor force as defined by Marxist Dependency Theory, investigating if this category is still pertinent under the financialized stage of capitalism. Marxist theories focused on new forms of imperialism and financialization identify a global pool of workers that is collective exploited by global capital, which contrasts with the definition of super-exploitation as a unique characteristic of the periphery. I present a historical discussion about the different attempted measures of exploitation and super-exploitation in Marxist literature and conclude that super-exploitation is still a useful category for the analysis of dependent capitalism. Relying on theory and data analysis, I argue about the importance of differentiating conjunctural convergence from structural conditions, and discuss how the materialization of exploitation (synthesis) depends on the dialectical movements of capital that necessarily finds distinct thesis and antithesis in the periphery when compared to the core.

From Semi-Periphery to Core: When Brazilian Money Goes Offshore

Samuel Weeks
,
Thomas Jefferson University

Abstract

Recent efforts by the OECD and the U.S. Treasury have made it increasingly difficult for nationals of Global North countries to avoid paying taxes via offshore financial centers. However, these initiatives have largely failed to extend their enforcement measures to Global South countries, where tax collection is weaker and levels of tax evasion are higher. Alongside its fellow BRICS, Brazil is a typical “feeder” country into the global offshore system, one from which the wealthy send billions of dollars each year toward Global North tax havens – of which, prominently, is the world’s last remaining grand duchy: Luxembourg.

In this paper, I seek to link empirically and conceptually Luxembourg, a jurisdiction at the “core” of the global offshore financial system, with Brazil, a country that stands at its “semi-periphery.” As was revealed in the 2016 Panama Papers, it was a Luxembourg-based subsidiary of a Brazilian-Swiss bank (J. Safra Sarasin) that opened the second highest number of offshore companies with the now-disgraced law firm Mossack Fonseca. How have these connections between Brazilian clients and Luxembourg-based bankers developed? What technologies and legal and financial structures allow wealth to leave Brazil for Luxembourg?

Concurrently, with an eye to more thoroughly elucidating the above dynamics between “core” Luxembourg and “semi-peripheral” Brazil, I propose a re-reading of the dependency and world-systems theory literatures on the topic of global finance. What light can this Marxist-inspired scholarship from the 1960s and 70s shed on the financialized, neoliberalized, globalized economic activity of today, much of which takes place “offshore”?

Financialization in Peripheral Countries: Insights from the Marxist Dependency Theory

Francisco Luiz de Andrade Neto
,
Federal University of Bahia

Abstract

This work aims to discuss the contributions of the Marxist Dependency Theory (MDT) literature about financialization in peripheral (dependent) countries. Financialization is – as many authors argue – still underdiscussed in this school of thought. For instance, the MDT’s “classical” theoretical production - formulated in the 1960s and 1970s by Ruy Mauro Marini, Vânia Bambirra, and Theotônio dos Santos - didn’t discuss the rise of financialization, as it took place before the consolidation of this process. Since then, only a few and dispersed contributions have been made about financialization and the MDT, without many dialogues between them. Through a systematic literature review, this study intends to group, synthesize, and discuss these contributions, seeking to highlight the impacts of financialization in dependent countries and its influence on the key concepts of the MDT: dependency, the transfer of value (from the periphery to the center), and super-exploitation of labor. This will contribute to the further development of a Marxist understanding of peripheral financialization, which already has a large literature developed by heterodox scholars. The general notion drawn from these Marxist-dependent works about financialization is that this process marks a new stage of dependency: the financial dependency. Transfer of value is aggravated throught financial and fictitious forms, meaning that the super-exploitation of labor is, too, as they are causally correlated. This points to a pauperization and worsening of working conditions among the working class in dependent countries. Auxiliary appoinments were also found, regarding the politics of financialization, the story of financialization in dependent countries, the relation between financial expropriation and superexploitation of labor, the role of government debt, and the financialization of welfare policies.
JEL Classifications
  • B2 - History of Economic Thought since 1925
  • F0 - General