World-Systems Theory is a theory of the world economy proposed by Immanuel Wallerstein. It states that it to understand any state, we must understand its spatial and functional relationships within world economy.
3 Tenets
One market and a global division of labor.
Development of world economy began with capitalist exchange around 1450, globalized by 1900. Producers commodify anything they can.
- Capitalism: every in world economy and beyond is driven by achieving profit -> seeking cheapest labor and cheapest products with highest quality
- Commodificiation: placing price on good and trading it Capitalism + commodificiation -> 1 market, global division of labor
Multiple states but everything happens in global context
Colonialism -> global context. Independent states are possible, but independent economies are not possible.
3 Tier Structure
Core and periphery are defined as processes, but some places can be labelled as such as well
- Core: processes that incorporate high education, high salaries, high tech, high consumption, more wealth
- Periphery: processes that incorporate low levels of every factor above
- Semiperiphery: places where both core and periphery processes occur Core usually exploits the periphery. Semiperiphery acts as a buffer bewteen core and periphery -> no polarization into two extremes
Effects
World-systems theory explains how colonial powers amassed large wealth. Mercantilism -> first wave of colonialism -> extracting goods from America and slave labor from Africa. Industrial Revolution -> second wave of colonialism -> cheap industrial labor, raw materials, plantations