In the last chapter, Lipton stressed the importance of the internal determinants of inequality. In this chapter, Theotonio dos Santos, a Brazilian economist,, points his finger at external conditions. Dos Santos is a member of what has been called the “dependentista school” of development thinkers, the great majority of whom are Latin American intellectuals. Dependency theory comes in many varieties; indeed, some argue that there is no such thing as dependency “theory.” Nonetheless, there is a body of thinking that is common to many of those who form part of this school, and in this chapter dos Santos presents a concise statement of some of its fundamental tenets. He begins by defining dependence and showing its linkages to Marxian theory and goes on to elaborate three basic forms of dependence: (1) colonial, (2) financial-industrial, and (3) multinational. This latter form, arising out of the power of the large multinational corporations that maintain operations in developing countries, is of greatest concern to dos Santos because he sees it as limiting the developmental potential of newly industrializing nations. This new form of dependence restricts the size of the local market and thus contributes to income inequality in developing nations. Ultimately, according to dos Santos, dependent development must culminate in revolutionary movements of the left or right .
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