Which theory classifies countries as CORE and PERIPHERY and explains their roles in the world economy?

• A. Rostow's Model
• B. World Trade Organization
• C. Wallerstein's World System Analysis
• D. Dependency Theory

Answer: (C)

The idea being tested is how the world economy is organized into a network where some countries dominate production, finance, and high-value industries, while others mainly provide raw materials and labor. Wallerstein's World-System Analysis frames the globe as a single capitalist world-economy with a core-periphery structure. Core countries exercise control over trade, technology, and capital, extracting profits through high-value activities and favorable terms of trade. Peripheral countries supply raw materials and labor, often facing weaker bargaining power and dependence on core markets. This system also includes a semi-periphery that sits between the two, capturing some benefits but remaining under the influence of core powers. The theory explains the persistent inequality in the global economy by showing how these roles are reinforced through trade, investment, and production networks.

Rostow's model, by contrast, outlines stages of development for individual countries rather than a global classification. The World Trade Organization is an international institution that governs trade rules, not a theoretical framework. Dependency theory discusses how peripheral regions are structurally constrained by more powerful countries, but the explicit classification of countries into core and periphery with systemic roles in the world economy is best captured by Wallerstein's World-System Analysis.