Structuralism and dependency
The most elaborate critique of the universality of economic theory formulated in Latin America, and the most thoroughly explored original contribution to economic thought from the perspective of developing countries, came out of the United Nations Economic Commission for Latin America (ECLA) after 1948.
ECLA is now known as ECLAC, Economic Commission for Latin America and the Caribbean. Cold War factors pushed the United States to try merging the new agency with the Organization of American States in an unsuccessful move that would have averted ambitions of intellectual independence. The ability of ECLA to speak with an independent voice was seen as a threat as it surged as a significant force among a variety of governments, inspiring the first generations of Latin American economists. Hundreds received training in ECLA headquarters in Santiago, Chile.ECLA defended the need to elaborate a Latin American economic theory based on observations of the specific conditions of the region and thus more suitable to explain its distinctive problems and development goals. ECLA structuralism shared some arguments with the structuralism of early development economics in its affinity with Keynesianism. Both schools of thought promoted the need for planned industrialization, recognizing the need to overcome structural obstacles in heterogeneous less developed economies. Both currents criticized the neoclassical theory of comparative advantage, but their analytical reach and methodologies differed. Latin American structuralism placed more emphasis on history and institutions, and it was unique in stressing the differences and asymmetries between economies in the center and the periphery of world capitalism (Sanchez-Ancochea, 2007).
Latin American structuralism also shared some insights with the earlier North American institutional school of economic thought associated with Thorstein Veblen, Clarence Ayres, J.R.
Commons and W.C. Mitchell as both challenged the narrow tenets of neoclassical economics and emphasized issues of power and history. Institutionalists, however, rarely addressed the reality of developing countries (Street and James, 1982; Mallorquin, 2001).In the late 1960s, dependency theory emerged within the cosmopolitan circles of Santiago that included a group of prominent Brazilian exiles. Elements of ECLA structuralism were transformed into more radical explanations for the obstacles to development. Intrinsic inequalities in the world capitalist system were conceptualized as originating in the extraction of surplus from the periphery that went to finance capital accumulation in metropolitan centers. Dependency gained significant influence beyond the region partly because it evolved in different directions and a variety of formulations. Some of its variants were infused with Marxist categories that emphasized chronic economic stagnation and massive poverty. Others called attention to the potential for industrial advance and wider consumer markets. By making explicit the linkages between international inequalities and class structures within the dependent periphery, authors in this perspective moved to a more interdisciplinary framework, addressing the nature of decision-making, income distribution and consumption patterns, industrial policies, and the treatment of foreign capital investments.