Wallerstein and the New World Economic Order


Immanuel Wallerstein (1930-2019), known as a neo-Marxist scholar in Western academia, was a Professor of Sociology and Economic History at Columbia University, Binghamton University, McGill University and Yale University, as well as President of the African Studies Association and the International Sociological Association.

He published a number of monographs on the emergence and development of the capitalist world economic system, which had an enormous impact in international circles. Western university circles today study the history of capitalism as the history of a world system, and an international school has developed on the topic. Wallerstein is the central figure of this school of thought. The rise of the “world-system theory” in the 1970s was marked by the book The Modern World System: Capitalist Agriculture and the Origins of the European World Economy in the Sixteenth Century published in 1974 by Academic Press, New York.

In the 1950s and 1960s the modernisation theorists represented by the American sociologist Talcott Parsons (1902-79) believed that the path experienced by developed Western countries was exactly the one on which developing countries were embarking, namely modernisation, Westernisation and Americanization, conceived as a system that should fulfil four functional requirements in view of perpetuating itself: 1. preserve its identity over time; 2. define its boundaries with the external environment; 3. ensure integration between its parts; 4. set its goals and organise the means to achieve them. Hence we can already understand the negative drifts of this system, which was tried to be imposed on different cultures and values with oppression and violence.

This “Western centrism” has met with many objections, of which the “dependency theory” and the “world-system theory” are among the two main responses. Unlike the “dependency theory”, which views the country as a research unit, the “world-system theory” regards the globe as a whole and – through the analysis of the three levels of politics, economics and civilisation – it profoundly reveals the “centre-semiperiphery” as the evolution and functioning mechanism of the structure of the outer edges.

In the era of economic globalisation, the study of the “world-system theory” more comprehensively interprets the contradictions, difficulties and development trends of the contemporary capitalist world system and more clearly sees socialism still as an “anti-system” force perspective.

The first question we ask concerns the concept and theoretical origin of the world system. Wallerstein believes that “the world system is a social system with a broad division of labour, which has scope, structure, membership groups, rational rules and cohesion”. On the one hand, life within this system is self-sufficient; on the other hand, the driving force behind the development of this system is internal. Countries, nations and ethnic groups are not complete systems. According to this criterion, there have so far been only two different world systems: the world empire and the world economy.

A world empire is a single political system controlling a vast area; the world economy, by contrast, is an autonomous economic network without a unified political centre that can detach itself from politics and act on its own.

The world empire superiorem non recognoscens was a permanent feature of the world scene for five millennia and political centralisation is both the cause of its creation and the source of its demise. This is because political centralisation can rely on violence (levies, taxes, wars) to ensure the economic flow from the periphery to the centre. The bureaucracy required for such a political structure, however, extracts too much profit, especially when oppression and exploitation lead to resistance that expands military investment.

As social achievements, technological progress and the development of the mode of production in modern world eliminate the “waste” of the overly cumbersome political superstructure, the surplus value from the lower to the upper class, from the periphery to the centre, from the majority to the minority, increases significantly.

When the groups (later States) became ethnically conscious, the historical mission of the world empire – or rather “universal” mission from the Egyptian proto-State to the Roman-imperial conception – came to an end, in the 16th century the prelude to the modern world economic system opened with the profound crisis of the Holy Roman Empire, later Germanic Empire. Wallerstein’s research begins here.

Its logical assumption is that capitalism is a historical system that is cyclical and tends to decline. The emergence of the “’world-system theory” has its own set of deep insights, knowledge and experiences. In his early years Wallerstein was engaged in research on post-war African development. During his long-term investigations and research, he realised that in the 1960s Western modernisation theories viewed development as the limitation (exploitation) of that same individual development in developing countries. He therefore assumed the impossibility of a world development model. That experience became the intrinsic motivation for Wallerstein to engage in the study of the “world-system”.

In terms of origin of the theory and research methods, the creation and development of the “world-system theory” is influenced by various studies of society. In terms of research methods, Wallerstein drew on the French École des Annales, founded by Marc Bloch (1866-1944) and Lucien Febvre (1878-1956), and integrated research methods from history, sociology, economics, political science, anthropology, geography and other disciplines to create the “integrated multidisciplinary approach”, i.e. the research method.

In terms of the origins of study, Wallerstein borrowed the concept of the “economic world” from Fernand Braudel (1902-85) – heir of Marc Bloch – through his “longue durée” theory, as well as the theses of the Russian economist Nikolai Dmitrievič Kondrat’ev (1882-1938), and inherited the political economy and the class theory of capital accumulation from Marx.

The analysis method borrows the centre-periphery model of the dependency theory and of the analysis of the external cause theory, and absorbs the developmental view of the internal cause theory from the modernisation theory. Furthermore, structural functionalism – i.e. a theory whereby societies and living organisms in their various parts constitute systems which, in turn, operate together as a functioning whole – had an important impact on the development of the “world-system” theory.

Wallerstein believes that although human history includes the histories of various tribes, ethnicities, nations and nation-States, these histories never develop in isolation and are always interconnected to create the “world-system”. Especially since the establishment of the capitalist world economic system, which has expanded day by day “until covering the whole world”. No country can keep itself apart from the outside world. It is also in this sense that Wallerstein often uses the expression “world-system” instead of “capitalist world economic system”.  

At the end of the 15th and beginning of the 16th century, with the development of the capitalist mode of production, a “world economic system” centred on North-Western Europe began to develop, i.e. the “capitalist world economic system”. According to Wallerstein, the world system has two components: on the one hand, the capitalist world economy is based on a world division of labour, in which different regions of the world economy (centre, periphery, semi-periphery) have been assigned specific economic roles. They have developed different class structures and hence used different methods of labour control and benefited unequally from the functioning of the world economic system.

The capitalist world economy cannot exist without any of these roles. On the other hand, the establishment of independent States and the emergence of State systems are important signs of the difference between the capitalist world system and previous world empires with a single political structure. Under the effect of the division of labour and capital accumulation, strong countries emerged at the centre of the world economy and weak countries at the periphery-margin.

Competition between strong countries created hegemonies in history, and the weak countries’ dissatisfaction led to the “anti-establishment movement” within the capitalist world system. From the 16th to 20th century, three hegemonic countries emerged in the capitalist world system: the Netherlands in the mid-16th century; England in the 17th and 18th centuries, and the United States of America in the mid-20th century.

“The problem is that hegemony is short-lived. Once a country becomes a hegemonic power, it starts to decline”. This has triggered a series of major changes in the entire world model.

Therefore in the inherited critical Marxism, the École des Annales is the basis of the theory of dissipative structures (an open system working in a state far from equilibrium) on the construction of a new world economic system. This is the overall theory of the Wallerstein school. It includes two aspects, namely the integrity of space and time.

In space, the centre of the modern world system is the semi-periphery, and the edge consists of the economic regions and the nation-State form of the international system. In time, the dynamic performance of the modern world system of the longue durée trend is a cyclical rhythm.

An integrated multidisciplinary approach is therefore needed to create an alternative history of the economic, social, natural and humanistic sciences in order to eliminate the tension “between” and “within” the different disciplines that study space and time dimensions.

Wallerstein’s theory on the deconstruction of the entire traditional discipline of socio-economic sciences inherited from the national myth – of which we understand the history and reconstruction of the historical system – has important implications.

While critically inheriting Marxism, Wallerstein constructs the holism of his world-system school, which includes two aspects, ie. the totality of space-time and the totality of knowledge. With respect to space, the modern world-system is a constitutive element of the world economy or international system, whereas, with respect to time, the dynamic characteristics of the modern world-system show centuries-old trends and cyclical rhythms tending towards its end. Wallerstein’s holism deconstructs the myth of nations and the myth of traditional economic science, which is particularly enlightening for understanding history and reconstructing both the historical and economic system that underlies the old world order.

When at the second meeting of the Central Comprehensively Deepening Reforms Commission of 11 July last, Xi Jinping spoke about building a new open economy system with a higher level, in my opinion he also meant to interpret Wallerstein’s words about the current disorderly and unfair world economic situation.

Giancarlo Elia Valori
Giancarlo Elia Valori
Advisory Board Co-chair Honoris Causa Professor Giancarlo Elia Valori is an eminent Italian economist and businessman. He holds prestigious academic distinctions and national orders. Mr. Valori has lectured on international affairs and economics at the world’s leading universities such as Peking University, the Hebrew University of Jerusalem and the Yeshiva University in New York. He currently chairs “International World Group”, he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group. In 1992 he was appointed Officier de la Légion d’Honneur de la République Francaise, with this motivation: “A man who can see across borders to understand the world” and in 2002 he received the title “Honorable” of the Académie des Sciences de l’Institut de France. “