Session 16 - End of the world system like we know it?

Immanuel Wallerstein in his essay “The rise and future demise of the world capitalist system” provides not only an interesting but also detailed and step by step view of historical development of the world systems to what exists today and what will happen in the future. Wallerstein talks about how the world developed from a feudalistic system, how mercantilism rose during the periods of colonization and then fell during the start of the industrial revolution which in turn led to the rise of the capitalist system.

An interesting theory put forward by Wallerstein is the world systems theory. This theory divides the world into three categories. There are the periphery nations which are the developing nations involved in agricultural produce and export low cost agricultural products and other raw materials to the other nations. There is very little industrial development in these countries as well as weak institutions. Wallerstein believes that these countries are being repressed and exploited by the core nations for reasons such as the prices of export of these countries not rising as fast as their imports from the core nations. Then there are the semi-periphery nations or nations that have managed to develop to an extent. They have industrialized and are involved in low cost manufacturing to produce products to export to the core nations. The core nations are the developed industrialized countries that dominate the world system, import cheap products and raw materials and export expensive technology and services in return to the periphery and semi- periphery countries.

Wallerstein goes on to talk about three reasons why this system still exists even though the periphery nations know they are being exploited: The power of the dominant countries such as military power, the rulers of these periphery countries want to keep there position and remain where they are so they do nothing, and lastly this world system needs a three layered structure to be stable and exist.

Towards the end Wallerstein talks about how there is no socialist system in the world economy just like there is no feudalist system because the world economy is a capitalist one. However there are too many contradictions within this capitalist system due to which this system will crumble leading to a socialist system, as predicted by Marx.

However this has not happened just about yet. There are a few countries that have had revolutions leading to a social change such as in China, Russia and Cuba. But the majority of the countries are still not socialist countries. And with the US and the western countries strongly opposing socialism while expressly believing and supporting capitalism even in countries other then their own, we shall have to wait and see if Marx's prophecies really do come true.