What is a Developed Country?

Any discussion of economic development – either implicitly or explicitly – contains the distinction between developed countries and developing (or under-developed) countries. While there are many theories on what promotes development and how best to achieve it, in all cases the goal is for a country to eventually become ‘developed’.

This begs the question – what is a developed country? There are at least three common definitions, which are presented below. These definitions overlap in many cases, but in others they are at odds. This piece argues that a broader definition is needed in light of recent failures of several ‘developed’ countries to cope with shocks ranging from the COVID-19 pandemic to natural disasters.

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Book Review of Money, Markets, and Monarchies: The Gulf Cooperation Council and the Political Economy of the Contemporary Middle East


Money, Markets, and Monarchies: The Gulf Cooperation Council and the Political Economy of the Contemporary Middle East, Cambridge: Cambridge University Press, 2018. ISBN: 9781108453158 (paper); ISBN: 9781108614443 (ebook)

Adam Hanieh’s book ‘Money, Markets, and Monarchies: The Gulf Cooperation Council and the Political Economy of the Contemporary Middle East’ is one of the most important works on contemporary Middle East. The book analyses the specificity of the Gulf Cooperation Council (GCC) as part of global capitalism by focusing on the socio-economic structures of the six Gulf States, the interlinkages between them and other socio-economic and financial relationships with the rest of the world. Joining other scholars, Hanieh draws attention to the fact that scholarship on the Middle East including the GCC has inclined towards an exceptionalism which overwhelmingly focuses on the Middle East as a resource-rich country and a site of various conflicts. This reductive emphasis diminishes the various ways in which the region integrates the contemporary patterns of capital accumulation and historical lineages of familial and monarchic capitalism. As he mentions, even the modern concept of the ‘BRICS’ excludes the large population of the Middle East. Filling this vacuum, the book focuses on how the GCC absorbs and reproduces contemporary modalities of capital accumulation in diverse sectors including finance, agribusiness, real estate, retail, telecommunications, and urban utilities. The six states of Gulf Cooperation Council (GCC) including Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Oman, and Bahrain have special linkages with global powers including the US, Israel, China and other Arab states. As important logistics hubs and sites of intermediate supply chains these states also connect with other countries.Read More »

Is Postcolonial Capitalism a Thing to Itself? Reviewing Sanyal’s Rethinking Capitalist Development


Kalyan Sanyal’s Rethinking Capitalist Development (2007, 2014) is a rare work of political economy for many reasons. It is written by an economist, but it’s so interdisciplinary that you won’t be able to tell. It is an attempt to theorize capitalism in the postcolonial context from the inside-out rather than outside-in, i.e. with no reference to an ideal type. It refuses to sit neatly in theoretical boundaries — it is not entirely Marxist, not entirely Postmarxist, not entirely neo-Gramscian, not entirely Foucauldian, but a strange concoction of all. Perhaps the only thing that is not rare is that like most interesting and influential works that emerge from the Global South, it too has been largely ignored in the academic circles of the Global North, especially in Economics. Read More »

Digital Workerism: Technology, Platforms, and the Circulation of Workers’ Struggles

UberTaxiProtestChicagoBy Callum Cant, Sai Englert and Jamie Woodcock

The so-called platform economy – the distribution of, and access to work through websites and apps – continues to grab headlines and the imagination of policy makers, researchers, and journalists the world over. Much attention is given to its rapid expansion, its potential for further growth, and the large amounts of wealth generated through it.

Amongst many others, PWC (2015) published a much-quoted study, if not always critically, which projected global revenues of $335 billion in 2025. If those numbers are potentially inflated, different valuations do point to a significant financial importance. For example, in 2015 ‘17 companies operating in the platform economy were valued at over $1 billion. Of these 17, 12 were based in the US, one in India (Olacabs), one in China (Kuaidi Dache), one in Australia (Freelancer), one in New Zealand (Trademe) and one in the UK (TransferWise)’.

Alongside these macro observations, an equally large amount of ink continues to be spilt about the liberating nature of the platform for the worker (for a particularly excited account see here). The gig worker, we are told, is entering a new reality free of the constraints of oppressive 9-5 employment, far away from the controlling gaze of their manager, able to choose when to work, set their own wages, and whom to work for. A new dawn of democratised entrepreneurialism is supposedly upon us.

Yet the actual evidence is – perhaps unsurprisingly – less rosy. Across the world, platform workers are confronted with the fact that, far from liberating them (or replacing them), new technologies play a disciplining role, deepening many of the characteristics of working conditions in a neoliberal economy: ranging from insecure and precarious employment relations, to greater managerial oversight and debt control. Callum Cant has masterfully documented some of these processes in his recent book on Deliveroo riders, as Jamie Woodcock and Mark Graham have done in their critical introduction to the gig economyRead More »

Don’t Buy the “Marketplace of Ideas”


Economic imagery pervades societal discourse. Part of this imagery projects markets as existing everywhere; the common societal parlance sees talk of the car market, the grocery market, the computer market, or, simply, the market. Yet, excepting traditional marketplaces or medinas, these markets have no physical manifestation. Unlike with other major social institutions there is no where to visit; there is no headquarters. Instead, markets are said to exist when there are competitors in the provision of services or goods and where each competitor has a fair and equal chance of succeeding. The market, then, exists in a metaphorical, rather than physical, sense – it implies that the capitalist system operates diffusely like a marketplace, rather than there being an actual marketplace in which economic transactions take place.

The further extension of economic imagery has seen the market metaphor applied to the provision of political and economic ideas, with the notion being that there exists a level-playing field on which ideas are free to compete and that this competition will weed out weaker ideas. Hence, “no platforming” of racist or homophobic speakers should be staunchly opposed as it will impede the competitive destruction of abhorrent ideas. An important ancillary notion is that any idea that has come to be orthodox received wisdom has justly achieved this status through free and fair competition in the marketplace of ideas. 

The problems with this account of the ideational development of society are legion, but I’ll limit myself to explaining just three, namely 1) product heterogeneity, 2) distribution of ideas, and 3) production of ideas.Read More »

State Capitalism Redux?


By Ilias Alami and Adam Dixon

Recent transformations in the global economy have sparked renewed interest in the role of the state in capital accumulation. Such transformations include a ‘return’ to various forms of state-led development across the global South since the early 2000s (in China, Russia, and other large emerging economies), extensive state intervention following the 2008 global financial crisis in the global North, and the multiplication of various forms of state-capital entanglements such as sovereign wealth funds (SWFs) and state-owned enterprises (SOEs). For instance, the number of SWFs increased from 50 to 92 between 2005 and 2017, while assets under management grew to over $7.5 trillion worth of assets, which is more than hedge funds and private equity firms combined. According to a recent study, ‘SOEs generate approximately one tenth of world gross domestic product and represent approximately 20% of global equity market value’. SOEs now dwarf even the largest privately-owned transnational corporations, with PetroChina currently leading the list with a market value of more than $1 trillion. Three of the top five companies in the 2018 Fortune Global 500 are Chinese SOEs (State Grid, Sinopec Group, and China National Petroleum Corp). Significantly, these state-capital hybrids have also become increasingly integrated into transnational circuits of capital, including global networks of production, trade, finance, infrastructure and corporate ownership. Does this renewed state activism – and its remarkably outward orientation – indicate a changing role of the state in capital accumulation and the emergence of new political geographies of capital?Read More »

The Moral Economy of Housing

Belknap-Spring-2018-Moral-Economy (1)

We must be insistently aware of how space can be made to hide consequences from us, how relations of power and discipline are inscribed into the apparently innocent spatiality of social life…(Soja, 1989, p. 6)

We are first and always historical-social-spatial beings actively participating individually and collectively in the construction/production—the ‘becoming’—of histories, geographies, and societies. (Soja, 1996, p. 73)

The fortification of housing insecurity, if left unchallenged, will constitute a normalized social basis, in which an ever-growing number of impoverished households are routinely ostracized. Analyzing the dynamics of this social condition demands robust explorations of the concrete reality in which housing, in general, is developed, reproduced and institutionalized over time and space.

At its most fundamental level, housing is more than a market segment or policy, it is a social relation that serves as the kernel of human survival, which can have profound consequences for the actors involved, the actions they take, and the outcomes that follow. As such, housing provides a set of meanings and values, a material form of emotional, cultural, political and economic significance. It is an institution that points to polyvalent higher order social arrangements that involve both patterns of social mobility and symbolic systems that infuse human activity with a powerful essence. Housing insecurity, therefore, is not a just a means of financial dispossession, but an ontological crisis concerning personal identity and the relationship to the rest of society.

Thus, the inherent task is to conceive of a situational dynamic that structures a housing system that enables residents to profoundly overcome socioeconomic inequity. The mission is to construct a moral economy, so to speak, that is generated along the lines of a systematic effort to maintain a high quality of life, whereby value, norms and obligations are metabolized through particular fields constituted by dynamic combinations of meanings and practices that embody a generalized sphere of community, a realm of possibility to enhance the development of one’s potential.

Overall, the intention is to allow for a normative discussion about what possibilities exist for assessing housing as a spatial activity that altogether adheres to socially determined aesthetic and moral expectations, that is, to approach housing as a language of dignity, as opposed to a vocation of spatio-temporal fixes. Hence, the responsibility of providing the means of socially equitable forms of shelter is not an insurmountable challenge; it can be administered in the name of social stability.

What is requisite is a recognition of moving beyond close instrumentalism and incrementalism with respect to short-term benefits of goal-specific tasks. This presupposes a negation of distancing from outward signs of housing insecurity, which inherently is a society-wide phenomenon, since institutional benign neglect only contributes to the slippery slope vulnerable people continually risk, toward the untouchable-caste status of homo sacer.

Soja, Edward W. (1989), Postmodern Geographers. New York: Verso
Soja, Edward W. (1996), Thirdspace. Oxford: Blackwell.

David Fields is a political economist from Utah. His work primarily centers on international political economy, with particular concerns on the role of finance in economic development. He also delves into the political economy of community planning, in order to promote socially equitable housing cross-nationally. This post was first published on the URPE blog. E-mail him at: dfields@utah.gov.



From the Washington Consensus to the Wall Street Consensus

Photo: Jpellgen

A new report published by the Washington DC office of the Heinrich Böll Foundation reviews the recent initiative being led by the G20 countries and their respective development finance institutions, including the major multilateral development banks, for the financialization of development lending that is based on the stepped-up use of securitization markets.

The report details how the initiative goes beyond the Washington Consensus reforms of the last few decades by calling on developing countries to adopt even farther-reaching degrees of financial liberalization on a new order of magnitude. In what Prof. Daniela Gabor of the University of West England, Bristol, calls the Wall Street Consensus,” such reforms would involve a wholesale reorganization of the financial sectors and the creation of new financial markets in developing countries in order to accommodate the investment practices of global institutional investors.

The new report, From the Washington Consensus to the Wall Street Consensus describes the key elements of the new initiative – specifically how securitization markets work and how the effort is designed to greatly increase the amount financing available for projects in developing countries by attracting new streams of private investment from private capital markets. The paper introduces the basic logic underpinning the initiative: to leverage the MDBs’ current USD 150 billion in annual public development lending into literally USD trillions for new development finance. In fact, the World Bank had initially called the initiative “From Billions to Trillions,” before finally calling it, “Maximizing Finance for Development.

While securitization can be useful for individual investors and borrowers under certain circumstances, the proposal to use securitization markets to finance international development projects in developing countries raises a set of major concerns. The report lists 7 important ways in which the G20-DFI initiative introduces a wide range of new risks to the financial systems in developing countries while undermining autonomous efforts at national economic development.

The key risks of securitization are:

  • The inherent risk because securitization relies on the use of the “shadow banking” system that is based on over-leveraged, high-risk investments that are largely unregulated and not backed by governments during financial crises;
  • The extensive use of public-private partnerships, despite the poor track record of PPPs, many of which have ended up costing taxpayers as much if not more than if the investments had been undertaken with traditional public financing;
  • The degree of proposed deregulation reforms in the domestic financial sector required of developing countries would undermine the ability of “developmental states” to regulate finance in favor of national economic development;
  • The degree of financial deregulation required would also undermine sovereignty by making the national economy increasingly dependent on shortterm flows from global private capital markets and thereby undermine the sovereign power of governments and their autonomous control of the domestic economy;
  • The uncertainty relating to governance and accountability for the environmental, social and governance standards associated with development projects. Such accountability has been fixed to traditional forms of public MDB financing for development project loans, but as future ownership of assets is commercialized and financialized, fiduciary obligations to investors may override obligations to enforce ESG implementation;
  • The deepening of the domestic financial sectors in developing countries, as required by the initiative, can create vulnerability as the size of the financial sector grows relative to that of the real sector within economies; and
  • The privatization and commercialization of public services, including infrastructure services, as called for by the initiative, has faced a growing backlash as reflected by the global trend of remunicipalizations. The fact that the securitization initiative is being promoted in such a high profile way by the G20 and leading DFIs despite all of these risks reflects an intensified contest between those supporting the public interest and those supporting the private interest.

The report also documents the relatively minor degree of interest expressed so far by global financial markets in the initiative, suggesting it is not likely to galvanize the trillions of dollars claimed by its proponents.

It concludes by reviewing the arguments for the scaled up use of traditional public financing mechanisms and several of the important ways in which this can be done, including steps that could be taken by G20 countries, DFIs and governments.

Rick Rowden recently completed his PhD in Economic Studies and Planning from Jawaharlal Nehru University (JNU) in New Delhi.