Why did dependency theorists argue that trade could keep peripheral countries poor?

Dependency theorists argued that international trade perpetuates poverty in peripheral countries because the global economic system is structured to favor industrialized "core" nations at the expense of the "periphery," which specializes in raw materials and agriculture.12

This dynamic is driven by several key factors:

• Unequal Terms of Trade: Theorists observed that the prices of manufactured goods imported by the periphery tend to rise faster than the prices of the raw materials and cash crops they export to the core. Consequently, peripheral nations must export increasingly larger quantities of resources just to maintain the same level of imports, a concept known as the Prebisch-Singer hypothesis.13
• Structural Exploitation: Colonial history reshaped peripheral economies into export-oriented molds, creating structural distortions that hinder domestic development. Capital surpluses generated in the periphery are often expropriated by the core through these unequal trade relations.1
• Capital Depletion: Because peripheral countries rely on the core for finished goods, they must spend their limited capital on high-priced imports rather than investing in their own productive capacity, creating a cycle of dependency and underdevelopment.2

Ultimately, dependency theorists argued that free trade does not benefit all participants equally but instead reinforces a framework of dominance and exploitation.12