The Modern World-System as a Capitalist World-Economy

Question 1

Origins of the Modern World-System:

Answer 1

• The modern world-system originated in the sixteenth century in parts of Europe and the Americas.
  
  • It expanded globally over time and has always been a capitalist world-economy.

Question 2

World-Economy and Capitalism Defined:

Answer 2

• A world-economy is a large geographic zone with division of labor, internal exchange, and diverse cultures.
  
  • Capitalism prioritizes endless accumulation of capital, with structural mechanisms favoring this process.

Question 3

Capitalism and World-Economy Connection:

Answer 3

• A capitalist system requires a world-economy; a unitary political structure isn’t necessary.
  
  • Capitalists need a large market and multiple states to navigate advantages and overcome obstacles.

Question 4

Institutions in a Capitalist World-Economy:

Answer 4

• Basic institutions include markets, competing firms, multiple states, households, classes, and status-groups.
  
  • These institutions are contextually specific to the modern world-system.

Question 5

Markets in a Capitalist System:

Answer 5

• Markets are both local structures and virtual institutions across space.
  
  • A complete virtual world market influences decision-making but never functions fully and freely.

Question 6

Capitalism and Quasi-Monopolies:

Answer 6

• Capitalism requires quasi-monopolies for high profits.
  
  • States use patents, import/export restrictions, subsidies, and other mechanisms to create quasi-monopolies.

Question 7

Anti-Monopolistic Features and Leading Industries:

Answer 7

• Quasi-monopolies are self-liquidating; entry of new producers constantly occurs.
  
  • Leading industries shift over time, creating a cycle, and firms compete fiercely.

Question 8

Firms in a Capitalist System:

Answer 8

• Firms are main actors in the market, engaging in intercapitalist rivalry.
  
  • Bankruptcy or absorption by stronger firms is common, essential for the endless accumulation of capital.

Question 9

Contradictions in Firm Growth:

Answer 9

• The growth of firms has downsides due to administration and coordination costs.
  
  • Despite contradictions, there’s a secular increase in the size of firms globally.

Question 10

Axial Division of Labor:

Answer 10

• Core-periphery concept relates to profitability, with core-like processes controlled by quasi-monopolies.
  
  • Unequal exchange results in a constant flow of surplus-value from peripheral to core-like producers.

Question 11

State Roles Based on Core-Peripheral Mix:

Answer 11

• Strong states protect core-like quasi-monopolies, weak states accept their lot, and semiperipheral states strive to avoid slipping into the periphery.

Question 12

Semiperipheral States and Protectionism:

Answer 12

Semiperipheral states, with a mix of core-like and peripheral products, aggressively adopt protectionist policies.
- They aim to protect their industries and compete for the relocation of leading products.

Question 13

Cyclical Rhythms of the World-Economy:

Answer 13

• Leading industries stimulate expansion, capital accumulation, and prosperity.
  
  • Overproduction, increased competition, and economic slowdown lead to a cyclical downturn.
  • Producers relocate to semiperipheral countries, influencing wage levels and global demand.

Question 14

• The world-economy exhibits cyclical rhythms due to the rise and fall of leading industries, impacting states, firms, and workers.

Answer 14

Conclusion: