Modernization Theory, Import Substitution, And Neoliberal Economic Theory

787 Words Dec 7th, 2015 4 Pages
In this essay I will compare and contrast modernization theory, import substitution, and neoliberal economic theory and their approach for helping developing states grow economically. Modernization theory, created in the 1950’s, argues that countries simply need to follow the path that the already wealthy states followed, and they too will become rich. In other words, less developed countries should embrace Western ideas that individualism is important to a functioning society and economy. Therefore, if individuals follow their own desire, the country as a whole will prosper, and individuals succeeding in an economy will receive profits. The other aspect of modernization theory argues that countries should industrialize as much as possible and move away from agriculture production (IR, 2014). Today, modernization theory focuses on the social elements that help progress the development of societies and aim to explain the process of social evolution. “This theory looks at the internal functions of a society while referring to social and cultural structures and the adaptation of new ways of living. This is because internal situations in societies greatly affect the processes of modernization.” (UKessays, 2013). A country that rewards the favored and government corruption is common hurts the state 's ability to progress in terms of modernization and can hurt its economic development. On the other hand, as the world has become more globalized, modernization has…

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