Discuss the political economy approach.

 According to Bianchi 2018: 88, ‘Political economy comprises the study of the socio-economic forces and power relations that are constituted in the process of the production of commodities for the market and the divisions, conflicts and inequalities that arise from this. The roots of this approach emanate from the changes that occurred during Industrial revolution and the development of capitalism in Western Europe during the 18th and 19th centuries’. The study of political economy in its early stages as discussed by its founding thinkers like Adam Smith (1723-1790), David Ricardo (1772-1823) and J. S. Mill (1806-1873) highlighted the impact of capitalism on the social organisation of the industrial societies. They were concerned with the production and accumulation of wealth (i.e., economy) and distribution (the political dimension). Later Marx (1818-1883) and Engels (1820-1895) reconfigured the focus on political economy by focussing on the distribution (or lack of distribution) of wealth across social classes. Political economists study the complex and variable economic, political, social, technological and cultural forces that shape the organisation and dynamics of domestic and international economies (Gilpin 2001: 40). With regard to tourism development the studies that were done on various domains of tourism did not take into account the political economy approach. It is to be noted here that the original studies on tourism focussed on the cultural, aesthetic and economic dimensions, without paying any heed to the power equations that are inherent in all human situations.

It was much later during1960’s and early 1970’s, the focus on uneven development across the world led to critical research on development theory with a major focus on the reduction of inequalities and other social problems. Simultaneously a critical analyses of the tourism studies during the 1970’s was highlighted with the work of Young’s, Tourism: Blessing or Blight (1973) and de Kadt’s Tourism: Passport to Development (1979). Both these works critically analysed the advantages and disadvantages of tourism by focussing on tourism from the perspective of development and dependency theory and also from political economy perspective.

The key theme of dependency theory is the relationship between development and under development. Dependency theorists argue that developing countries have an external and internal political, institutional, and economic structure that keep them in a dependent position relative to developed countries. When developing and developed countries come together in the global economic scene it is seen that the developing nations (periphery) are feeding the developed nations (core) economy. Thus, as per dependency theorists, incorporating the peripheral economies into the global capitalist economies, results not only in influencing production to align at the demands at the centre, but also on siphoning the economic surplus to the dominant countries. As the dominant countries at the centre continue to develop based on that surplus, the countries at the periphery struggle with underdevelopment. The political economy that stems from dependency and underdevelopment theory has received little attention in tourism studies research. It was Britton (1982) who realised the importance of this approach and tried to understand the capitalist structures that not only drive tourism development but also inequalities that are visible in the uneven pattern of development.

The dependency paradigm on the other hand also argues that in a society it is not the internal factors that lead to underdevelopment, but it is the external political, institutional and socio-economic structures that keep the developing countries in a dependent position relative to developed countries. A. Frank (1967) in his work Capitalism and Underdevelopment in Latin America described the global economic system as having two poles- a developed ‘metropolitan centre’ and an underdeveloped ‘periphery’. Raw materials that are taken from the periphery are converted into manufactured goods at the centre and then are exported back to the periphery. The periphery then becomes dependent on the centre to purchase its raw materials and also buy manufactured goods in return, resulting in a flow of capital from the periphery to the centre. This is known as leakage. Dependency theorists discuss about this interdependence between the core and the periphery.

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