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division of labor
Christine E. Bose
World systems theorists were among the first to
use the concept of an international division of
labor by illustrating how the production of
goods and services for core or more developed
countries relied on the material resources of
peripheral or developing nations (Wallerstein
1974). Their work describes the changing
political and economic relationships among
nations over the last six centuries, beginning
with the period of colonization when Western
European nations took possession of other coun
tries in order to gain access to their raw materials
such as sugar, coffee, gold, silver, or labor sold
into slavery. By the middle of the twentieth
century most of those colonies had gained their
political freedom and titular control over their
own resources, but were never able to break
away from their economic dependence on highly
In the twentieth century a new process called
global or economic restructuring created a new
form of international division of labor between
the developed countries (now labeled the global
North, a term replacing the old Cold War label
First World) and the developing nations
(now called the global South, which replaced
the concept of a Third World). Beginning in
the 1970s, in order to lessen production costs
and enabled by improvements in information
and production technologies, US, Japanese, and
Western European corporations began to off
shore some of their production processes to the
global South, often moving to export processing
zones (EPZs) within these countries, which are
defined as industrial zones that provide manufac
turing infrastructure, tax reductions, low labor
costs, lax environmental regulations, and other
incentives. As a result of this worldwide eco
nomic restructuring, much basic manufacturing
and heavy industrial production were relocated
to developing nations, while corporate head
quarters, service work, and final product finish
ing stayed in developed nations. This process
was initially referred to as the growth of the
global assembly line or the global factory (Kamel
1990). Instead of taking raw material resources
from their former colonies, transnational cor
porations (TNCs) based in the global North rely
on residents of the global South to provide inex
pensive labor for factories now located in devel
In addition, international development or
funding agencies such as the International
Monetary Fund and the World Bank influence
global South economies when they loan money
to poor and developing nations, because loans
are tied to required austerity measures known
as structural adjustment programs (SAPs).
SAPs require the debtor countries to reduce