Definition of Banana Republic

What is the definition of the term "banana republic"? What does the term "banana republic" mean?

The term "banana republic", which was coined by writer O. Henry in 1904, refers to a small, politically unstable country which relies on the export of a single product (such as bananas) to keep its country running.

This reliance on just one export results in a great deal of power being placed in the hands of just a few people. The working class population is typically very large and very poor, while the ruling class is small and very rich.

In these banana republics, there is usually an understanding between the politicians, key businessmen and military, which allows the three groups to maintain their power. All three groups benefit with this arrangement.

The more diverse that an economy is, the less the power in the country can be concentrated.

In the case of a "banana republic", the group of people that controls the single export (for instance, bananas) will have near-absolute power.

In this day and age, the term "banana republic" refers to a small country with an easily exploitable economy.

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