This thesis is an investigation of the concept of large-scale hydroelectric projects as structurally connected to the expansion of political and economic systems, and their role in linking a previously and relatively isolated region to a market system. The study is intended to be an examination of how they are in fact part of a larger process that is contributing to the gradual marginalization of socio-cultural and economic groups. This process, it will be argued, becomes apparent when these communities find themselves cut off from their traditional livelihood environments with little or no alternatives to compensate for those losses, and become increasingly dependent upon capitalist market mechanisms for survival. The case study focuses on the Yacyreta? High Dam in Paraguay, and examines the experience of an island community following resettlement. The study examines the manner in which resettlement planning resulted in the forced incorporation of this rural community into the cash economy.