In
political science, the term
banana republic describes a politically unstable country with an economy dependent upon the exportation of a limited-resource product, such as
bananas or minerals. In 1901, the American author
O. Henry coined the term to describe
Honduras and neighbouring countries under
economic exploitation by U.S. corporations, such as the
United Fruit Company.
[1] Typically, a banana republic has a society of extremely
stratified social classes, usually a large impoverished
working class and a ruling class
plutocracy, composed of the business, political, and military elites of that society.
[2] The ruling class controls the
primary sector of the economy by way of the
exploitation of labor;
[3] thus, the term
banana republic is a pejorative descriptor for a servile dictatorship that abets and supports, for
kickbacks, the exploitation of large-scale
plantation agriculture, especially banana cultivation.
[3]
A banana republic is a country with an economy of
state capitalism, whereby the country is operated as a
private commercial enterprise for the exclusive
profit of the ruling class. Such exploitation is enabled by collusion between the state and favored economic
monopolies, in which the profit, derived from the private exploitation of public lands, is private property, while the debts incurred thereby are the financial responsibility of the public treasury. Such an imbalanced economy remains limited by the
uneven economic development of town and country, and usually reduces the national
currency into devalued
banknotes (paper money), rendering the country ineligible for
international development credit.
[4]