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Economic Dependency

Definition

Economic dependency refers to a situation where a country heavily relies on another country or countries for its economic growth and development. This reliance can be due to factors such as trade imbalances, foreign aid, or technological dependence.

Analogy

Economic dependency is like being in a one-sided friendship where you constantly rely on your friend for everything, from money to resources. You become dependent on them and lose your independence.

Related terms

Trade Imbalances: Trade imbalances occur when the value of a country's imports exceeds the value of its exports or vice versa. This can contribute to economic dependency as it affects the overall balance of trade between countries.

Foreign Aid: Foreign aid refers to financial assistance provided by one country to another for various purposes such as development projects, humanitarian relief, or economic support. Developing countries may rely on foreign aid, leading to economic dependency.

Technological Dependence: Technological dependence occurs when a country heavily relies on advanced technologies from other countries for its economic activities. This reliance can lead to economic dependency if the country lacks domestic technological capabilities.