World-Systems Theory Or How Did It All Happen

As the theory of relativity has shattered Newton’s discovered principles into a small space-time capsule in which they were relevant, and as philosophy constantly renders religion as useful mainly in the cultural field by dismantling its axiological monopoly, so does the world-system theory exercise a huge paradigm change in the fields of economics, history and politics.

And, as all good things in this world, it’s not mainstream.

The approach was initiated by Immanuel Wallerstein and its basic view is set on a strange mixture or neo-marxism with the admittance of liberal economic reason. Basically, the evolution of politics and economics in the world is seen in the core-periphery relationship. The core acts as a hegemonic despot that has as its main goal the accumulation of wealth and power and, in order to do so, it seeks to control the activity of the periphery. Wallerstein sees four instruments of control as being fundamental to the maintenance of the status quo: “commodification, the multiplicity of modes of labor control, commodity chains, unequal exchange between core and periphery (asymmetric trade) and group of monopolizing non-specialized capitalists functioning as the anti-market”¹. What is interesting in this approach is that orthodox economics is recognized as being correct (in principle). Thus, Wallerstein states in his essay that competition is stronger in peripheral (poor) regions and also economic sectors. Here, there is no interest from the core to monopolize resources and factors, thus enabling for a wide dispersion of wealth and power at local level. On the other side, in key sectors and regions, monopoly is the best economic engine that can lead to the accumulation of wealth and therefore used extensively. An interesting example here is vertical integration, which is a form of monopoly, but is widely allowed (from a legal point of view) in the West.

The World System theory partisans consider that the current (modern) hegemony, that of the West, has begun to take shape only in the last two centuries, following an Asian-centered system². The latter was one in which China held a core position (in terms of demographics, resource abundance, technological advancement and political power) but was dethroned in the age of geographical discoveries (in the West) by Europe which came to appropriate large amounts of precious metals from the Americas and, latter man-power from Africa (see also the post How Africa Still Remains An Economic Colony Of Europe). J. Hobson states further in his book that what we currently acknowledge as history is just a deformed eurocentric perspective that ignores the underlying causes of our progress. I believe this to be true and a relevant example is the overwhelming list of Chinese inventions that predated the corresponding European ones we now so pridely recognize as being our own. In a previous post (Towards The New Cultural “Triad”) I have detailed also the fundamental differences in cultural terms between Asia, the West and the Arab World, regarding social organization and moral (social) values.

As the rise of Asian economies becomes more and more obvious and inherent, the approach posed by the World Systems analysis should act like a compass in predicting the future transfer of power and in the reshaping of the world economy.

¹ The Modern World-System and Evolution, I. Wallerstein, Journal of World-Systems Research: Volume 1, Number 19, 1995;

² The Eastern Origins of Western Civilization, J. M. Hobson;