Raul Prebisch and the Origins of the Doctrine of Unequal Exchange-1980

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Raul Prebisch and the Origins of the Doctrine of Unequal ExchangeAuthor(s): Joseph L. LoveSource: Latin American Research Review, Vol. 15, No. 3 (1980), pp. 45-72Published by: The Latin American Studies Association

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RAUL PREBISCH

AND THE ORIGINS OFTHE DOCTRINE OF UNEQUAL EXCHANGE*

Joseph. LoveUniversityf llinois t Urbana-Champaign

The perceptionof the nternational conomic system s one of ndustrialcenter nd agrarianperiphery,nwhichtheformer ominates the atter,has had a tremendous nfluence n the analysis ofunderdevelopment;the significance f the idea is impossible to gauge because its acceptanceis still xpanding.Rautl rebisch'sanalytical erms, nd theconcomitanttheoryof traderelations,now known as unequal exchange, have beenadopted not only by the followersof a dependency theory raditionnLatin America, stemmingdirectly romPrebisch,but also bynon-Latin

American writers (assuredly, with extensive modifications) such asArghiri mmanuel, Andre Gunder Frank, mmanuelWallerstein, ohanGaltung,and SamirAmin.

In therealm of economic planning, Prebisch's influencehas like-wise been enormous, not only in the U.N. Economic Commission forLatin America ECLA, or in Spanish, CEPAL) and the U.N. Conferenceon Trade and Development-agencies which he headed-but also intheLatinAmerican Free TradeAssociation,the CentralAmericanCom-mon Market, the Alliance forProgress,and in the development pro-

grams of several Latin Americangovernments, uch as theKubitschekadministrationn Brazil 1956-61).2In theunderdeveloped world, center-peripheryerminology as

been widely accepted-often by governmentswhichwelcome theentryofforeign apital, as well as those whichdo not. At theConferenceonInternational conomic Cooperation (the North-Southdialog ) in Parisin June 1977, the Brazilian foreign minister,representing a regimeknown for ts economic neo-orthodoxy nd its divergence fromECLAprecepts,nonetheless called for substantial transfer fresourcesfrom

thecenter o theperiphery oftheworld economic system.3*I wish to thankRaul Prebisch,Hans Singer, Enrique Iglesias, and the ECLA staff nSantiago, Chile, for heirkindassistance inmy researchfor hispaper,and AlbertHirsch-man for critiqueof t. The opinions and errorshereinare, ofcourse,myown.

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LatinAmerican esearch eview

Prebisch's center-periphery hesis, first ormulatedn the 1940s,suggesteda pointof view thatmost economists n theUnited States and

Western Europe still find difficult o accept. It implied a hegemonicrelationship etween two discrete lements na single economicsystem,even if primary and secondary centers changed relativepositions.Not only that;the elaboration ofthe idea ofunequal exchange betweenthe two elements ed to the conclusion thatthecenterderivedpartof tswealth from heperiphery but not all, in Prebisch's version,because ofthe technologicalprogress generated by the center).Furthermore,m-plicit n the original scheme was the idea thatthe relationshipwas anenduring one. The formation f new centers by peripheralareas was

possible only by breaking way from he old center.Many of Prebisch'scritics n the leftdifferedwithhimmore on thepaths towardthatbreakthanon the nature of the international ystem.

The problem examined in this essay is how and why Prebischformulated is initial hesis,whichbecame thatofECLA; this s partof alarger problem of how and why the Third World came into existenceafter1945. Like all theories,this one has some forerunners-most ofwhichwere notgenetically elated-but thePrebischthesis n anyeventis probablythemost influential dea about economy and society ver to

come out ofLatin America.Although this paper belongs to this history of economic doc-trines, nd in a broader sense to thehistory f ideologies, I will arguethat much of Prebisch's reasoning was based on empirical observationand experimentation.Therefore,we must begin with Prebisch's biog-raphyand the economic history fArgentina n the second quarterofthe twentieth entury.

Bornin thecityof Tucumanin 1901, RauilPrebisch studiedat the

University f Buenos Aires, whose Department Facultad) of Economicsat the timewas probablythe best school foreconomic theory n LatinAmerica.4 Prebisch gave clear promise of a distinguishedcareer withinArgentina's economic establishment,as an insider's insider. In 1923,upon completing master's degree in economics, he was asked to jointhe staff t the university.5n 1922, i.e., before Prebisch's graduation,Enrique Uriburu, on behalf of the elite Sociedad Rural, the powerfulstockbreeders'association, appointed the young man directorof theRural's statistical ffice. wo years aterthe Sociedad Rural sentPrebisch

to Australia,where he studied statisticalmethods related to stockrais-ing, and presumably,he also obtained a broader perspectiveon Argen-tina's position in the international conomy.6 By 1925 he was both ateacher at the university nd an official n the Argentinegovernment's

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PREBISCH AND UNEQUAL EXCHANGE

Departmentof Statistics. n 1928 he was again workingpart-time or heSociedad Rural, compiling statistical earbook for he organization. ts

president, Luis Duhau, noted in his preface to the compendium thatthe marked nterdependenceof ourranching nd agricultural ctivitiesand the world market xplains . . . thebroad coverage the Anual gives tointernational data. 7 Thus, fromhis earliest professional activities,Prebischgained an appreciationof theinternational conomic system.

Furthermore, rebisch was intensely nterested n policy issuesfrom he outset of his career.8 n 1928he assumed the editorshipoftheRevista conomica, journal publishedby the government-directedancode la Nacion Argentina; twas concerned not onlywithpressing mone-

tary matters,but also with problems of stockraising, griculture, ndinternational rade-not with theoretical ssues in economics. In theearly 1930s Prebisch was an economicadvisor to the Argentinegovern-ment's ministries f financeand agriculture, nd proposed thecreationof a centralbank (with powers to controlthe interestrate and moneysupply) to the government f Gen. JoseUriburu,who had seized powerin 1930. Finance MinisterAlbertoHueyo contracted ir Otto Niemeyer,the British inancial xpert, o revisethe projectPrebisch nd othershaddrawn up in 1931. The final version of the law, was however, again

modified extensivelyby Prebisch and other Argentineeconomists andstatesmen. The Banco Centralwas in factthe nation's first rue centralbank, and from ts inceptionin 1935 until1943, Prebisch served as itsDirector-General.9

In many respects, Prebisch and his colleagues in the 1930sweretreading n doctrinalterra ncognita.Before the Depression it was be-lieved thatArgentinahad prosperedaccording o the theory f compara-tive advantage in international rade.This doctrine, riginatedbyDavidRicardo (1819), and elaborated by JohnStuart Mill (1848), AlfredMar-

shall (1879), Eli Hecksher (1919) and BertilOhlin (1933), can be sum-marized as follows:1. Given an absence of commercebetween two countries, fthe

relativeprices of two commoditiesdiffer etween them, bothcan profitby trading uch commodities t an intermediate riceratio.That s, bothcan gain even if one country produces both traded goods more effi-ciently hantheother.

2. Countries export ommoditieswhose productionrequiresrela-tively ntensive use of factorsfoundin relative abundance withintheir

boundaries.3. Commoditytrade reduces (if it does not eliminate) interna-tional differencesnwages, rents, nd otherreturns o factors fproduc-tion.

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4. Among otherthings,the theory ssumes the absence ofmo-nopoly power and the spread of the benefitsof technologicalprogress

across the whole trading ystem.'0In Argentina, the benefitsof export-ledgrowth,based on aninternational ivision oflabor,made the theoryof comparativeadvan-tage a near-sacrosanctdoctrine at least down to the GreatDepression).In the words of Carlos Diaz-Alejandro, From 1860 to 1930 Argentinagrew at a rate that has few parallels in economic history,perhapscomparable only to the performanceduringthe same period of othercountriesof recent settlement. Not onlydid powerfulexportgroupsespouse comparative advantage, but the ArgentineSocialist party-

viewing tself s thedefenderofworker nd consumer nterests-vigor-ously opposed industrialprotectionismn the1920s. 2

That decade, however,was a period ofdisequilibrium s well asexpansion inworldtrade,and thoughArgentinaprospered,thecountryexperiencedthesame problemsas a numberof otherprimary-producingnations n the finalyearsbeforethe October1929 crash-namely, fallingprices, rising stocks, and debt paymentdifficulties. rgentinawas infactthe firstnation in the world to abandon the gold standard in theGreat Depression, in December 1929. In October 1931 its authorities

introducedexchange controlsto try o stem the outflowofcapital andfacilitateherepayment f oans negotiated n hardcurrencies.Prebischlaterwrotethat Exchange controlwas not theresultof a theory utwasimposed by circumstances. '3The Depression thus broughtabout theabandonmentofmanyhallowed economicdoctrines nd practices.

In the crisis,Great Britainexploited her monopsonist positionagainst hermany supplhers. n general she attemptedto purchase lessabroad, and therebygotherimports heaper,despite Britain'sown de-valuation in 1931. 4 In the case of Argentina,Britain'strading power

was magnifiedby the South Americannation's loss of dollar invest-ments.The United States had become a majorsupplher o Argentina nthe mid-1920s,but the latter ountry, fcourse,had chronicdifficultiesin paying directlyforU.S. importswith her own noncomplementaryexports.ThereforeArgentinahad depended on U.S. capitalexports,butduringtheDepression, NorthAmerican enders disinvested n Argen-tina. 5Excluded from he U.S. marketby hightariffsnd otherregula-tions,and cut offfrom ontinentalmarkets s well in the earlythirties,Argentine tatesmenfeared above all the loss of the Britishmarket-al-

ready partly losed by theOttawa Conferenceagreement 1932) amongGreat Britainand her dominions, several of which were Argentina'sexportcompetitors.'6Britain'stradingpower was further nhanced bythe fact hat n these yearsshe boughtmuchmorefromArgentina han

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man Pact as a technical advisor; later that year, he attended the WorldMonetary Conference n the same city.By his own account, Prebisch

was influencedby JohnMaynard Keynes's proposals forthatmeeting.Keynes, in a set of articles for the London Times,recommendedhispump-priming remedies of deficit pending to increase national in-

come, and thereby o increase employment.Keynes also proposed thecreation of an internationalmonetary uthority o resuscitate reditforworld trade,and it s noteworthy hat he made Argentinaone of sevencountries hatwould have qualifiedfor he maximum oan of 450milliondollars. (In the next few years Prebisch would become an enthusiasticKeynesian, an influencefromwhich he later sought to freehimself.)23

But the World Monetary Conference broke up in failure, nd the ten-dency toward bilateralismn worldtradecontinued.BackinArgentina, rebisch sought to understandanothervexing

problem wroughtby the Depression-declining termsof trade. In 1934he published an articlepointingout that agricultural rices have fallenmore profoundly han those of manufacturedgoods, and that n 1933Argentina had to sell 73 percent more than before the Depression toobtain the same quantityof (manufactured) mports. Prebischfurther-more pointed out that n the previous year the nation had to pay double

the amount nterms f gold on its fixedforeign ebt obligations s it didin 1928, an additional and considerable disadvantage to adverse changesin the country's ermsof trade. (In the same articlePrebisch attackedasscholastic theorthodoxequilibrium heoriesof his senior colleague at

the University f Buenos Aires, ProfessorLuis Gondra, because suchdoctrines gnored the stubbornfact f sustained depression.)24

Prebisch was a member of an economic team gropingwiththecrisis, nd recenteconomic historiography as emphasized thatthepo-licies of Federico Pinedo (financeminister, 933-35 and 1940-41) and his

collaborators, ncluding Prebisch, nvolved extensive governmental n-tervention n the economy; such innovation occurred despite the oli-garchic political cast of the regime from1930 to 1943 (the infamousdecade of politicalhistory).Not only did the state reform he monetaryand banking system through the creation of a central bank and theintroduction f exchange controls,but it also intervened n the proces-sing and marketingof Argentine exports, .e., beef and grain.25Thisnovel and vigorous activity y the statemay have had corporatist s wellas neoliberalsources of nspiration, ut in this endeavor Argentinawas

clearly n stepwith herneoprotectionist radingpartner,GreatBritain.At the international evel, the state also chose an interventionistcourse, and in 1933 Prebisch,at Geneva and London, played a leading

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role in convincingpolicymakers fthe other threemajor wheat-export-ing countries-the United States, Canada, and Australia-to agree to a

plan to cut back production, n terms speciallyadvantageous to Argen-tina, since it had to make no reduction n acreage sown. But the briefhistory f the arrangement howed the fragilityf such efforts: rgen-tina, Canada, and the United States all broke the termsof the planbefore he end of1933.26

The return f severedepression n 1937-38, a problemoriginatingin the United States, had its major spread effectsn the less-developedagricultural-nd mineral-export reas of the world,because Europe andJapan were pump-priming through their armaments programs.

Wheat was one of thecommoditiesforwhich pricesfell harply n 1937.27As othercountries ntroducednew trade controls, o did Argentina, n1938, n theform f quantitative estrictionsn imports. n the nexttwoyears,Argentina's bankingofficials, mong whom was RautlPrebisch,were trying o keep international redits and debits in balance in thestrictest hort-run ense. Thus trade policy was not yet consciouslyused to foster ndustrialization.28

Nevertheless,withsharplyrestrictedxport arningsthroughoutthe Depression-the dollar value ofArgentine xports n 1933 was one-

third he 1929figure-self-sufficiencyn industrywas a policyofneces-sity. Manufacturing n Argentinagrew impressively n the 1930s andearly1940s, a factthat was recognized by contemporaries t home andabroad. In particular, he CentralBank's RevistaEconomica oted an in-crease in outputof 85 percent by value) between the industrial ensusof 1913 and that of 1934-35.29 Argentinawas experiencing phase ofindustrialdevelopment common to southern South America, whereChile and Brazil also found themselves in similarsituations with thecollapse of theirexport sales. By 1935, a North American economist

thought hat There is probablyno major sectionoftheworld in whichthere s greater ndustrial ctivity elativeto pre-depressionyears thanin temperateSouth America (i.e., Argentina, southern Brazil, andChile).30 Industrialization n the face of the Great Depression was aresponse of agricultural-exportingations elsewhere too, notably inEastern Europe. In any case, Argentina'sCentralBank made a sharpbreak withthepast in 1942bychampioning ndustrialization. he Bank'sannual reportforthatyear,reflecting rebisch's views, argued thatex-ports and industrial development were by no means incompatible;

rather, he issue was to change the compositionof importsfrom on-sumerto capital goods.3'Prebisch the policymaker interests us less than Prebisch the

51









emerging conomic theorist, hough the two are hard to separate. In thelatter capacity he was beginning to formulatehis theory of unequal

exchange by 1937. In that year the Revista conomica oted:Manufacturingndustries,nd thereforendustrial ations, an effica-ciously ontrol roduction,herebymaintaininghe valueof their roducts tdesired evels.This s notthecase with griculturalndlivestock ountriesor,as is well known, heirproductions inelastic n accountofthenature ofproduction]s well s the ackoforganizationmongst griculturalroducers.

Inthe astdepression hesedifferences anifestedhemselvesn a sharpfall nagriculturalrices nd in a much maller ecline ntheprices f manu-factured rticles. he agrarian ountriesost part oftheir urchasing ower,with heresultantffectn thebalance fpaymentsndonthevolume ftheir

imports.2

The emphasis was thus on the elasticity f supply of ndustrialproduc-tion, and implicitly n monopoly, and not on wage contracts n theindustrial countries, which was later to be a focal point of Prebisch'sanalysis.

In the same comment he Revistanoted thatArgentina's ndustrialcomplexmade its greatestgains intwo periods,WorldWar , and duringtheworldwide recrudescenceof the policy of economic self-sufficiency

duringthe years 1929-36. 33 Thus Prebisch seemed to be nearingtheview thatexport-led growth was no longer a viable path to economicdevelopment.

Prebisch was also intensively nterested n the trade cycle n Ar-gentina. The Central Bank began its effort o conduct countercyclicalmonetarypolicy in 1937, by decreasing the public's purchasing powerthrough he sale of bonds in that boom year; in the followingperiod ofcontraction,twould attempt o expand purchasing power by loweringtherediscountrate.34n 1939, n its annual reportfor heprevious year,theCentral Bank-representing Prebisch'sthinking n the matter-ar-gued thatthenation's trade cycles were primarily reflection f thoseofits principal industrialized) trading partners. t also held that Argen-tina's heavy importrequirements, ombined with nternal redit xpan-sionwhichwas triggered yan initial xport urplusand which resultedin additional demand for mports,produced a balance-of-paymentsri-sis that occurredrepeatedly in the historyof the Argentinebusinesscycle. 5

Afterhis dismissal from he Central Bankin 1943, Prebischbeganto read widely in the recent economic literature.36 eturningfor themomentto teaching,he prepared a series of ectures n 1944 n which hereferred, or he first ime,to center and periphery. He developed ahistorical rgument,with Britain s thenineteenth-centuryenterof the

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trading nd monetary ystembased on the gold standard. (Clearly, hiswas a bettermodel for he first alf of the century han the second half,

but Britain s center forthe whole period fitArgentina's situationwell

enough.) Under Britain's leadership as the cycle-generating enter,Prebisch rgued, the worldeconomic systemhad equilibratedgold flowsand the balance of paymentsover the course of the cycleforboth centerand periphery. Gold tended to leave Great Britain, he center of thesystem, and to enter countries of the periphery n the upswing of thecycle. Then it returned n the downswing. A problem for peripheralcountrieswas that when gold departed in the downswing, . . . therewas no way to diminishthe gold flow except by contracting redit....

No onecould

conceiveof . .. the possibilityofraising the rediscount

rate n competitionwiththe monetary enter n London. Thus overallmonetary tabilitywas onlymaintained at the cost ofeconomic contrac-tion in the periphery. The gold standard was therefore n automaticsystemfor hecountriesoftheperiphery, ut notfor hecenter, wherethe rediscountrate could be adjusted fordomesticneeds.

Passing on to the post-WorldWar years, Prebischconcluded thatNew Yorkbankers n the 1920s and 1930s did not have theknowledgeorexperience of the British financial oligarchy, though of course theworld situation was dramaticallydifferentfterthe war. By 1930 theUnited States had sucked up the world's gold. Consequently, the restoftheworld, ncludingourcountry, is]forced o seeka means of nward-directed development (crecerhacia adentro) 37 a phrase that ECLAwould latermake famous.

The Argentine usiness cyclehad depended on exogenous factorsoperating hrough hebalance ofpayments. n the upswing exports ndforeign nvestmentproduced an influx of gold and exchange credits,creating new money and therefore mports. Such changes also ex-panded credit o theagricultural nd pastoral ndustries;but because ofinelastic supply, during the downswing, creditwas immobilized n theruralsector. Additional importswere paid forwithreserves, producinga monetary risis.38

In seeking a solution to Argentina's problems,Prebisch began tothink n more general terms bout Latin America and its relationswiththe United States; his first oncern in that area had involved a plan in1940 (probably drafted by Prebisch, but presented to congress by Fi-nance MinisterPinedo) to link the Argentine conomy to the surgingpower oftheUnited States and to growingLatinAmericanmarkets, npart by exportingmanufactures.39

Afterhis dismissal from he Central Bank,Prebisch was twiceinMexico during the mid-forties t the invitation f Mexico's centralbank

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LatinAmericanesearcheview

(Banco de Mexico), which he helped organize. On both occasions heparticipated n internationalmeetings:once in 1944 at a gatheringof

intellectualsfromLatin Americaat theColegio de Mexico on problemsthe region would face n thepostwarera,40 nd again in Mexico Cityatan inter-Americanmeetingof centralbankers n 1946.

Prebisch's interest in industrialization as a solution to LatinAmerica's economicproblemsoriginally rose from desire, sharedbymany other Argentinecontemporaries,to make Argentinaless eco-nomically vulnerable, a vulnerability ainfully videntforthe wholeperiod 1930-45. As noted above, the Argentine Central Bank, underPrebisch's eadership,had begun toadvocate industrializationn its 1942

report.By implicationPrebischwas recommending he same policy forother Latin American countries in his Colegio de Mexico lecture in1944.41 In his Conversations at the Banco de Mexico in the same year,Prebisch again noted that the period ofgreatest ndustrialdevelopmentin Argentina had been the Great Depression and times of world war,periods in which the nationhad to produce for tselfwhat it could notimport.42Later, ECLA theorists would elaborate extensivelyon thisproposition,as theydeveloped the conceptof inward-directeddevel-opment.

In a 1944 article n Mexico's Trimestreconomico, rebisch notedthat heUnited States,unlike Argentina,had a low propensity oimport(defined as the change in the value of importsgenerated by a givenchange in thenationalproduct). Since othercountries,he implied,hadhigh propensitiesto import, and the U.S. had replaced Britain s thechief ndustrial trading partnerof the Latin Americanstates, Prebischexpanded on the League experts'argument n 1933and warned thatthepostwar international rading systemfaced the danger of permanentdisequilibrium.43

Prebisch first sed the terminology enter-peripheryn print n1946,at the second meetingmentionedabove, that ofthehemisphere'scentralbankers,who convened at the nvitation fthe Banco de Me'xico.Prebisch now identified he United States as the cyclicalcenter andLatinAmerica as the peripheryof the economic system. The empha-sis, as indicated, was on the trade cycle, whose rhythmsthe U.S.economy set for the whole international ystem.Fiscal and monetaryauthoritiesntheUnited Statescould pursue a policy of full mploymentwithoutproducingmonetary nstability,rebisch argued; furthermore,

such authoritiesdid not need to be especiallyconcernedabout the im-pact of fullemployment policies on the exchange rate of the dollar inothercurrencies. By contrast,Prebisch asserted, the nations ofthepe-riphery ould notapply thesame monetary ools as the center.Extrapo-

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lating from his 1944 argument with referenceto Argentina, Prebischcontended that the money supply in peripheral countries could not be

expanded inpursuitof full mployment, ecause such a measure wouldquickly exhaust foreignexchange (implicitly ecause the new moneyput too greata pressure on imports, ssuming no devaluation).

This 1946 statement and previous writingsof Prebisch impliedthatperipheral ountriesfaced threeoptions, all withunacceptable con-sequences: they could have strongcurrencies nd maintainhigh levelsof importsat the cost of high unemployment;theycould fightunem-ploymentwith an expansionist monetarypolicy but would thereby re-ate inflation nd decrease their bility o import,because ofa fall n the

exchange value of theircurrencies;or, ifthey used monetarypolicy tomaintain high levels of employment, but failed to devalue, their re-serves would disappear. When prices of the periphery's products fellduring the downswing of the cycle, furthermore, overnmentsof pe-ripheral ountries, t least in isolation,could not affectworld prices fortheirgoods as the centercould for tsgoods. Thus equilibrium heoriesin international rade were not acceptable.44 This was a direct ssault onthe economic science of the industrialized ountries.

Back in the classroomin Buenos Aires in 1948, Prebisch specifi-

cally attacked the theoryof comparativeadvantage, and noted that tsprecepts were repeatedly violated by the industrializednations,whoseeconomists nonetheless used classical trade theoryas an ideologicalweapon. He also implied that ndustrial ountries cted as monopolistsagainst agricultural ountries n the trading process. Prebischthen as-sertedthathistorically,nboththeUnited States and Britain, echnologi-cal progressdid not result n a decrease in prices, but in an increase inwages. The fruitof technical progress tend[ed] to remain in GreatBritain n the nineteenth entury;yet,because Britainhad sacrificed ts

agriculture, artof thebenefits ftechnologicalprogresshad been trans-ferred o the new countries n the form fhigher and values. Britain'snineteenth-centurymport coefficientdefinedas the value of importsdivided by real income) was estimated by Prebisch as 30-35 percent,whereas that of theU.S. in the 1930s was only about 5 percent.All ofthis mplied a blockage to growthfor he agricultural-exportingeriph-eryunder thenew largely elf-sufficiententer.45

This center-periphery heoryeven in nuceimplied a single sys-tem, hegemonically organized. Though the term hegemony did not

appear in thisearlyuse ofcenter-peripheryerminology,rebischhim-self,years ater,would specifically mploythe word to characterize ela-tions between the two elementsof the world economy.46To appreciatethe significance fthe termswe should bear in mind that the idea that

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there was somethingfundamentallydifferentbout the economies ofthe retarded regions 47was still novel in the 1940s. The concept of

underdevelopment as a syndromewas onlyelaborated nthatdecade,chiefly fter hecreationof specialized UnitedNations agencies in 1947-48.* The euphemisms developing countries and less developedcountries, were still n the future.48While a few Marxists and otherspreferred o employ backward ratherthan underdeveloped, evenbackward among these non-center-peripheryermsdid not in itself

implyhegemony; nor did backward necessarily put the centralem-phasis on the international apitalist system. Rather, such a conceptcould imply that the problem was largely one of leads and lags-the

modernization hesis n itsahistorical etting.49

Despite the factthat some of the key ideas of Prebisch's lateranalysis were set forth ninternationalmeetings n 1944 and 1946, therewas no discussion on these occasions of an Economic Commission forLatin America, the U.N. agency that was subsequently to be Prebisch'sprincipal theoretical nd ideological vehicle. Rather, t resultedfromChilean initiative n 1947 at U.N. headquarters in Lake Success, NewYork. The founding of ECLA and the struggles nvolved in that effort

have been related n several places,50and need not detain us here. Theagencywas approved by theU.N. Economicand Social Council in Feb-ruary 948,and ECLA held its firstmeeting nSantiago, Chile, inJune fthatyear. AlbertoBaltraCortes, the Chilean Minister of the Economy,presided at the occasion. At the opening session Baltra stressedLatinAmerica's need to industrialize, n attitude o whichrepresentatives fthe United States and the European colonial powers professednot toobject.Prebisch's deas were alreadyfamiliar o theChilean leaders, andfor the future of ECLA, or at least its most famous thesis, the chief

outcome of the meetingwas a resolutioncalling for a studyof LatinAmerica'stermsoftrade.51

*The early theoryof unequal exchangewas of course part ofa largerproblemofeconomists' and demographers' recognitionof underdevelopmentand the populationexplosion in theyears after he War; such recognitionwas inevitably nfluencedby theCold War,decolonization,new nationalisms,neutralism, nd the rise of a host ofU.N.and other nternationalgencies. The Third World-including theperception f ts nhabi-tants'common interests gainst the West-was in most respectsreified n theyears be-tween theend of the War nd the Afro-AsianConference t Bandung in 1955. In particular,the demographer nd economichistorianAlfred auvy coined theterm TiersMonde in

1952 on themodel of the Abbe Sieyes revolutionary iersEtatof 1789, and the ournalTiersMondeand a collectionof essays with the same title ppeared in 1956. (L'observateur,4Aug. 1952,p. 5; Sauvy to author,Paris,15 Dec. 1978.) But LatinAmerica,where center-periphery heorywas born, was not generallyconsidered partof the ThirdWorlduntilafter he Cuban Revolution 1959).

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But ECLA was not yetECLA, withoutPrebisch's eadership. Hispersonality,heses,and programs o dominatedthe agency n itsforma-

tive phase that t stood in sharp relief o the Economic CommissionforAsia and the Far East (establishedin 1947) and the Economic Commis-sion forAfrica1958),agencieswithmore purelytechnical rientations.2The year of ECLA's founding,1948, seemed propitious for obtainingPrebisch's services: in Peron's Argentinahe was excluded fromofficialposts, perhaps because of his long and close association with the na-tion's traditionaleconomic elite.53Meanwhile, his reputation as aneconomistin Latin America had been enhanced by the publication nMexico ofhis IntroduccionKeynes 1947).

Prebischturneddown the first ffer o directECLA in 1948,be-cause he feared an international rganization ike the U.N. would notpermitunderdeveloped countriesto analyze economic problems fromtheir own perspectives;in this regard,he had in mind the League ofNations' lack of nterestn underdeveloped areas.54A fewmonths ater,however, he was again invited to go to Santiago to work on specialassignmentas editor and author of the introduction o an economicreport on Latin America, authorized at the initialECLA meeting. InSantiago Prebischalso elaborated his theses on the deterioration fthe

terms ftradenTheEconomicevelopmentf atinAmericand tsPrinci-palProblems,ublished in Spanish inMay 1949,and dubbed the ECLAManifesto, n an obvious allusionto the Communist anifesto,yecono-mistAlbertHirschman.55Prebischimplicitly lreadyhad his opinionsabout the direction f LatinAmerica's long-rangetermsoftrade,sincehe had arguedin theclassroom n 1948thatthe benefits f technologicalprogresswere absorbed by the center.Now, a new studyby the U.N.DepartmentofEconomic Affairs, elative ricesof ExportsndImports fUnderdevelopedountries, rovided an empiricalfoundationforhis the-

sis. Thisworkwas an examinationof ong-term rends n relativepricesin the goods traded by industrialized and raw materials-producingcountries,and concluded that the termsof trade fromthe late nine-teenthcentury illthe eve of WorldWar I had been movingagainsttheexporters fagricultural oods and in favor f theexporters f ndustrialproducts: On the average, a givenquantityof primary xportswouldpay, at the end of this period, foronly 60 percentof the quantityofmanufacturedgoods which it could buy at the beginningof the pe-riod. 56

ECLA explained this finding n part by arguing that gains inproductivityver the period in questionwere greater n industrial hanin primary roducts,thus challengingbasic assumptions of the theoryofcomparativeadvantage. Ifpricesof industrialgoods had fallen,this

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Latin mericanesearcheview

development would have spread the effects f technicalprogress overthe entirecenter-peripheryystem, nd one would expect the termsof

trade for gricultural oods to have improved. They did not do so; andthe significance f this fact, ECLA asserted, had to be understood intermsof trade cycles. During the upswing, the prices ofprimary oodsrise more sharply than those of industrial goods, but they fall moresteeply duringthedownswing. In theupswing theworking lass ofthecenter absorbs real economic gains, but wages do not fallproportion-ately duringthedownswing. Because workers re not well organizedinthe periphery least of all in agriculture), he periphery bsorbsmoreofthe system's ncome contraction han does the center.57

Another nitialECLA argument grew out of Prebisch's observa-tions on Argentina's mportproblemsin the 1930s. The United States,the principal cyclicalcenter,had a much lower importcoefficienthanexport oefficient,nd the formerwas also much lower than thoseof theLatin Americancountries.The U.S. tended to sell more to Latin Americathan tbought from he region, exhaustingLatin Americanreserves ndcreating tendencytoward permanentdisequilibrium. uch a tendencyhad not existed,ECLA averred,duringthe time n which mport-hungryGreatBritainhad been theprincipal enter.8

In an articlepublishedin1950, the year after he ECLA manifesto,another UnitedNations economist, Hans Singer, argued that technicalprogress nmanufacturing as shown in a rise n incomesin developedcountries,while that in the productionof food and raw materials nunderdeveloped countries was expressed in a fall in prices. He ex-plained the differentialffects f technicalprogress n termsof differentincome elasticities f demand forprimary nd industrialgoods-an ex-trapolation fErnst Engel's law that the proportion f ncome spentonfoods fallsas incomerises-and in termsofthe absence ofpressureof

producers forhigher ncomes in underdeveloped countries.Since con-sumers ofmanufacturedgoods in world trade tended to live in under-developed countries and the contrarywas true for consumers ofrawmaterials, inger continued,the atter rouphad thebestofbothworldswhilethe former ad theworst.59 his idea was linked to Prebisch's andthetwomen's theorieswere quickly dubbed the Prebisch-Singer hesis,thoughbotheconomists state thattherewas no direct xchange of deasat the time the related sets of propositions, based on the same U.N.data, were developed.60 (Prebischof course was in Santiago, and Singer

in New York.) Since ECLA's Economic evelopmentppeared in print nMay 1949,more than sixmonths before Singer presentedhis AmericanEconomicAssociation paper (published in 1950), Prebischclearly eems

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tohave reached his positionearlierthanSinger;in fact, heU.N. studysimplybolsteredconclusions he had alreadyreached.

By 1951, the year that ECLA became a permanent organ of theUnited Nations, the agency's emphasis had shiftedfrom mport coef-ficients o disparities n income elasticitiesofdemand at the center forprimaryproducts, and those at the peripheryfor ndustrialgoods.61This adoption of Hans Singer's terms was significant, ecause it dealtwith the center countries as a group and not just the United States,which had unusually low import requirementsbecause of its tremen-dous agricultural utput.

But Prebisch and the ECLA team he organized were also inter-

ested in another dimension of the problem-monopolistic pricing t thecenter.The original nalysis n 1949-50 laid much more emphasis on therigidity f wages in the downward phase of thecycle than on monopo-listicpricing s such, but the latter rgumentwas there.62 n any event,both phenomena were assumed to be nonexistent n neoclassical tradetheory. eripheral ountriesdid not have monopolies on the goods theyofferedn the world marketwithrareand temporary xceptions) ustasthey acked well-organized rural abor forces hatwould resist hefall nwages during the downswing of the cycle.

Samir Amin sees the emphasis on the rigidity f the center'swage bill as a significant ifference etween the argumentsof Prebischand Singer,who focused on the differencesn demand for griculturaland industrialproducts. (Amin immediatelyfollows up his approval ofPrebisch's thesis on wages by adding to it the argument that It wasmonopoly [after 880-90] that made possible the risein wages in theindustrialized enter. 3)*

Attacking he internationaldivision of labor, as ECLA did from1949 on, entailed a call forthe rapid industrialization f the periphery,

but ECLA's manifesto -admittedly, withoutelaboration-also calledfor nternational greementsforprice protectionfor primaryproductsduringthe downswing of the trade cycle.64 n this regard ECLA fol-

*Celso Furtado,a veteran cepalistand one of the most creativemindson Prebisch'steam,later offered different,marxisant xplanationoflabor's role in the stickiness ofcenterexportprices: in industrialeconomies, class struggle s the basis for capitalistgrowth;workers' organizationsseek to expand labor's share of the national product,while inunderdeveloped countriesthisdoes not occur because labor (and especially agriculturallabor) is disorganized, and the supply of labor is extremelywage-elastic.Diagnosisof theBrazilian risis, r.Suzette Macedo (Berkeley,Calif.:University fCaliforniaPress, 1965),

pp. 48-51, 61. (PresumablyECLA never vigorouslypromotedrural labor organizationbecause of the mmensesocial and politicalproblemsthis policywould have encountered,includingtheprobablehostility f manymemberstates of the Commission.)

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lowed a recentU.N. efforto establish an International radeOrganiza-tion. The idea ofcommodityprice stabilization t the internationalevel

had been discussed at the BrettonWoods Conference 1944), a meetingwhich resulted n the creationof the International ank forReconstruc-tionand Development and the nternationalMonetaryFund. In 1947-48a special U.N. conference t Havana established an International radeOrganization, whose principles included intergovernmentalction toprevent violent price fluctuations n primarycommodities. The U.S.Congress ultimately ailed to approve the ITO, whichconsequentlydidnot become partofthe nternationalmonetary ystem.65 hus a programofpricestabilization orprimary ommodities,which mplicitlyncluded

the idea of countermonopoly gainst the industrializedcountries,wastaken up by ECLA in 1949. (This was a line ofargumentthat would beelaborated by the U.N. Conference on Trade and Development afterPrebisch became itsfirst irectorn 1963).

Having examined ECLA's early development in terms ofPrebisch'sexperience n the 1930sand 1940s, we must also ask: towhatdegreedid theoriginalECLA doctrines f1949draw on earlier conomictheories? wish to cast a glance at some possible sources of nspiration.

To begin with, et us note that classicalmercantilist octrinepre-scribed selective industrialdevelopment. Mercantilismwas less a co-herent body of doctrine than a rough-and-ready set of policies tostrengthen he state-there was as yetno distinction etween politicaleconomyand economics as an analyticaldiscipline-but seventeenth-and eighteenth-century tatesmen tried to promote industry fortheends of theirgovernments.In Portugal, for instance, two ministers,Ericeira 1675-90) and Pombal (1750-77) attemptedto establish certainindustries n orderto reduce imports, nd thereby oreduce dependence

on Britain.Aftermercantilism ad fallenvictim o Adam Smith's attackin Wealth fNations 1776), Alexander Hamilton's Report n Manufactures(1791) and Friedrich ist's National ystem fPolitical conomy1841) pro-posed the creation oftariff alls to develop national industry. istwasmuch more thetheorist, f course,and his work became the ideologicalpillar of the Zollverein. In particular, ist was the father f the infantindustry argumentthat high initial costs of production could be re-duced over the longer run througheconomies of scale and externaleconomies.

WithinArgentina,an advocate of industrializationn the 1920s(an era ofrising ncome and rising mports)was Alejandro Bunge. Likemercantilisttatesmen, Bunge defended industrialization s a policy ofreducing mports orelieve pressure on the balance ofpayments,buthe

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viewed industrialization s a complement to export-driven rowth,notas a substitute or t. 6

During the interwar years the self-perceived underdevelopedcountries were the succession states of the Austrian Empire, and theBalkan countries n general. Governments of Central and Eastern Eu-ropean countries,many of them agricultural xporters, onsciouslytriedto develop manufacturing uring the Depression decade.67 And, as theeconomist Harry Johnsonhas noted, these nations produced a numberofeconomists-Mandelbaum, Kaldor, Balogh,and Rosenstein-Rodan-whose writings became part of mainstream economic developmenttheory fterWorldWar I. Their common theme was the need for ndus-

trialization,nd theirmodel was implicitly ermany.8WithinEasternEurope, Rumania in particularwas the scene ofspiriteddebates on economic development n the 1920s. Stefan Zeletin,one Rumanian theorist, dvocated a programof ndustrialdevelopmentbased on a closed economymodeled on List'sNational ystem69 Moreextreme n his program forclosing the economy to foreign radein theshort and middle terms was Mihail Manoilesco. Certain resemblancesbetween the ECLA doctrine nd thatof Manoilesco were noted by JacobViner, the neoclassical trade theorist, lmost immediately fter he ap-

pearance of the ECLA manifesto n 1949. A generation aterthepoliti-cal scientist Philippe Schmitterwrote that In essence and embryo,Manoilesco anticipated the central arguments and even many of thespecific points of what. . . latercame to be known as the ECLA ...Doctrine.. . 70 Thus the Rumanian's work merits ur close attention.

Manoilesco's most important study, Theoriedu protectionnisme(1929), quickly appeared in several European languages, including aPortuguese edition published in Sao Paulo in 1931. In this and a subse-quent work, Le siecledu corporatisme1934), Manoilesco-like Prebisch,

centralbanker-made a frontal ttackon theexisting nternational ivi-sion of abor,and held that productivityn agricultural ountrieswasintrinsically nferior o that in industrial countries. (The distinctionbetween the two was determinedby the compositionof their xports.)The Rumanian did not hesitateto call agricultural ountries backward(pays agricoles tarrieres), ontendingthat excess labor in agriculturensuchnations should be transferredoindustrial ctivities. his argumentwas latermade by ECLA economists-but one must note, it was alsoput forth y other heorists.71

Manoilesco denounced the nternational ivisionof aborand theclassical theoriesof tradethatrecommendedto agricultural ationsthattheycontinue to channel theirpopulation into areas of what he con-sidered inherentlynferior roductivity.n a vulgarized version of his

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argument n Le siecledu corporatisme, anoilesco assertedthat the aver-age industrialworkerproduces ten timesthe value of an agricultural

worker, nd that griculturalountries are poor and staypoor, as longas theydo notindustrialize.Thus the nternational ivision of abor wasbasically a swindle: classical international rade theory justified theexploitation fone people byanother. 2

Using theUnited States as an example for heyears1880to 1910,Manoilesco made an argument similar to one of Prebisch's, viz., thatproduction n an industrialized conomy tends torisemore rapidly hanthatcountry's nternational rade. 3This contention eems to be a closecousin of the argumentthat theUnited States had a low propensity o

import, hough Prebischwas pointingout a peculiarityf theAmericaneconomy and notgeneralizing bout the process of ndustrialization.I am not suggestingthatPrebischwas directlynfluencedby Ma-

noilesco, and I foundno reference o theRumanian economist's worksin Prebisch'searlywritings.Prebisch n 1977 confirmed he absence ofsuch an influence, hough the Revista eCienciasEcon6micas,he ournalofthe economics department f theUniversity fBuenos Aires (wherePrebischwas a sometimeprofessor),printed rticles n the atter hirtiesin which Manoilesco's theories were discussed.74Hence we may as-

sume Prebisch at thetimewas familiarwithManoilesco's work.Manoilesco differedharplywithPrebisch nd ECLA on one criti-cal point, viz., his assertion that, as the process of industrializationspread from ne country o another, herewas a long-term endencyfortheprices ofraw materialsand agricultural roducts to rise, relativetopricesof industrialgoods.75Furthermore,Manoilesco did not view theproblemof nternational rade as one of monopolisticpricing t thecen-ter. In addition, we may note that Manoilesco prescribed a closedeconomy, whereas Prebisch'swould always remainpartlyopen, giventhe

criticalrole of capital goods imports. Finally,Manoilesco's state,having full controlof the economy, was at least potentially otalitarian,whereas Prebisch's was a variantof the liberalstate of the postdepres-sionera. Nonetheless,Manoilesco's ideas-in theLatinAmericancircleswhere theywere known-probably helped pave theway for heaccep-tanceof ECLA doctrineswhen theyappeared in 1949.

For ack ofevidence we mustreject nydirectnfluence n PrebischofManoilesco or twentieth-century arxists, some ofwhom-notablyConstantinDobrogeanu-Gherea and Evgeni Preobrazhenski-offeredseveralpropositionsroughly nalogous to

those of ECLA.76Yetwe mustnote that RauilPrebischwas not the first esearcher to use the termscenter nd periphery o describe themoderncapitalist ystem. Rather twas Werner ombartwho, in the lastpartof his multivolume pus Der

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Moderne apitalismusrev.ed., 1928),wrote hat We must . . distin-guish capitalistenter-thecentral apitalist ations-from massof

peripheralountries iewedfromhat enter; he formerre activend

directing,he atter,assiveand serving. ngland onstitutedhecapi-talist enternthefirstalf f henineteenthentury;ater,n the ongerperiod ofHigh Capitalism,*WesternEurope [joined England].... Fi-nally,n the astgeneration,heeastern artof theUnitedStateshasmovedup [tothecenter]. 77

Sombartlsowrote fthe dependency fperipheralountries,and even of the servitude fthepeasantry f the periphery,n partcaused byWesternuropean apitalism.78ut he didnotprovide ny

theoryfrelations etween enter nd periphery;n particular,e of-

fered o analysis ftherelation etween usiness ycles nd the nter-national istributionf ncome. rebisch oesnotrecollectcquaintancewith ombart's assageatthetime f his nitial se ofthetermsenterandperiphery;79uteven fhe was inspiredndirectly,rebischwouldowe littlemore han n arrestinghrase, inceSombartnlyusedcenterandperipheryn a few catteredaragraphs.

In anycase,ECLA's theses, romheirnitialppearancen1949,werehotlyontestedyneoclassicalrade heorists,uch sJacob iner.

AsAlbert irschman asrecentlyointed ut, heconomics rofession

had justbeentreated oa formal emonstrationyPaul Samuelson n1948-49 hat, nder ertainonventionalbutunrealistic)ssumptions,;tradeouldserve s a completeubstituteor hemovementffactorsfproduction rom ne countryo another,ndicatinghat nternationaltrade ouldpotentiallyqualize ncomes mongnations.Thusthe essrigorousbutmuchmorerealistic)rgumentsfPrebisch nd Singerburst ponthe scene ustafter amuelsonhadraisedneoclassicalradetheoryonewheightsf legance, nd against his heoryhenew deaswouldhavetostruggle.0 ooking ackontheproblemnthe ate1970s,andpossibly eferringo Viner, rebisch ecalled a senseofarrogancetoward hosepoorunderdevelopedconomists f theperiphery. 81nparticular,CLA's intellectualdversaries ttacked he dea of a long-term eteriorationf he erms f rade or rimaryroducers. lthough

*Sombart'sivision f hehistoryfcapitalismnto early, high, nd late phases-apparentlyrawnfromhe periodizationf the MiddleAges-has found certainur-rencymongMarxists;.g., LateCapitalisms the itle f recent ookbyErnestMandel.For brief urveyfSombart's iewson thehistoryf apitalism,ee his article Capital-ism n theEncyclopediaf ocial ciencesvol.3, pp. 195-208),wherehealso aysclaim obeing he first riter ouse capitalism odescribe historicalconomicystem.om-bart'sworkhasperhaps een neglected ecauseofhis acceptancef theNazi regimenthe1930s.

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Prebisch's original data base (the U.N. study, Relative rices) has beenlargelydiscredited, his debate is stillverymuch alive.82

Meanwhile, since its birth n the 1940s, the nfluence f Prebisch'scenter-periphery nalysis has been vast and diffuse.Elsewhere I havetried to show, in briefcompass, how ECLA helped shape the radicaltheses of unequal exchange in the work of Andre Gunder Frank, andpartly through him, the work of Samir Amin.83 Of Prebisch himself,Amin wrote, at the end of Accumulationn a World cale:

There an be no doubt hat he firstdition of hiswork]did notdo justice othedebt owe, along with ll concernedwithnonapologetictudy f under-development,o theLatinAmerican riters n the subject.Raul Prebisch ookthe ead inthisfield, nd I have shown nthisbookthat hetheoryfunequalexchangewas founded y him, ven f heconjuncturalontextn whichhesetit, nhis first ersion, as lost ts significance.tis also to the UnitedNationsEconomic ommission orLatinAmerica, f whichhewas themoving pirit,that owe the essenceof the criticalheoryowhich adhere,for twas thisCommission hat ed theway in the reflectionsromwhich all thepresentcurrentsnLatinAmerican hinkingn thesematters avedeveloped....84

In Accumulation, min repeatedlycondemns economism, anindifferencenWestern conomic analysisto social and political ontextsat a theoreticalevel; and it s interestinghat recent nternalhistory f

ECLA makes a similar point about its own work, even though the-agency's structural nalysis went farbeyond its monetarist oppo-nents in distinguishing he unique featuresof peripheral economies.85This is a criticism hatPrebisch himselfhas taken seriously n recentwritings;he notes, for xample, that the interests f theupper strataofthe peripheryare closely linked to those of the center-a point theCominternhad made, in differenthraseology,half a century arlier.86Prebisch's current nalysis hardly convergeswith that of more radicaltheorists,but it does seem closer: he makes clear his belief that the

center(s) exploittheperiphery, nd he now speaks of an economic sur-plus which the periphery n part exportsto the center. He places moreemphasis on inherentmonopolisticrelationships hanhe formerly id,arguingthat some price relationshipshave always been unfavorable,ever since the periphery was incorporated into the internationaleconomy. 87This udgment clearlydemotesthe tradecycleas a mechan-ism for withdrawing ncome from he periphery.Prebisch now rejectsthe consumption-oriented ocietyof the centertype in favorof de-mocratization fperipheral reas, a processwhichdepends on a sharp

increase in capital accumulation and a modification but not trans-formation?) f thedistribution f ncome.88YetPrebisch stillhas little osay, it seems, about the politicalmeans wherebythe world economicsystemmightbe restructured.

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In this essay I have describedhow RautlPrebischformulatedthesisofunequal exchange over the course of two decades ofinvolve-

ment n economicand financialpolicy. have shown thatPrebischcameto rejectthethesisof comparative dvantage via his partialrejection, nthecontext f peripheraleconomies, ofthemonetary nd bankingpoli-cies of Keynes. I have argued thatrelativelyittle f thecenter-peripherythesiswas derived or borrowedfromother writings, nd that t owedmore to empiricalobservationand experimentation han to Prebisch'sreadingofothertheorists-Marxist,corporatist,Keynesian,orneoclas-

sical. Not paradoxically, hope, I have also argued thatPrebischhadformulated he elementsofhis thesisbeforetheappearance, in 1949,of

the empiricalbase onwhichthe thesisrested n itsfirst ublishedform-theU.N. study,Relative rices.

Although there were a few other economists fromthe ThirdWorldwho made important ontributionso developmenttheory n theearlypostwaryears (e.g., Hla Myintand ArthurLewis), Prebischwasprobablythe only one exclusivelytrained n, and residing n, a ThirdWorldarea; he was also the only one directing n institutional orumthat could be construedas a distinctive hirdWorld voice. ThirtyyearslaterPrebisch'sviews are stillevolving;but whateverhis finalposition,

he has surelywon himselfa place of eminence in the historyof thetheoryof imperialism-even if imperialism is not partof the ECLAvocabulary.

NOTES

1. See ArghiriEmmanuel, Unequal Exchange:A Studyof the mperialismf Trade NewYork: Monthly Review Press, 1972); p. 263 ( center-periphery );Andre GunderFrank, Capitalism nd Underdevelopmentn LatinAmerica:Historical tudies fChile andBrazil, rev. ed. (New York: Monthly Review Press, 1969), p. 8 ( metropolis-satellite ); Immanuel Wallerstein, The Rise and Future Demise of the WorldCapitalist System:Concepts forComparativeAnalysis, Comparativetudies nSocietyandHistory 6, 4 (Sept. 1974), p. 401 ( core-semiperiphery-periphery ); ohanGal-tung, A Structural heory of mperialism, Journal fPeaceResearch, o. 2 (1971), p.81 ( center-periphery ).

2. Celso Furtado, Economic evelopmentfLatinAmerica:A Survey rom olonialTimes othe Cuban Revolution, r.Suzette Macedo (Cambridge: CambridgeUniversity ress,1970), p. 192 (CACM), p. 208 (Kubitschek); Luis di Marco, Introduction, n diMarco, ed., Internationalconomics nd Development: ssays inHonor of Raul Prebisch(New York: Academic Press, 1972), p. 11 (LAFTA); JeromeLevinson and JuandeOnis, TheAlliance hatLost ts Way Chicago: Quadrangle, 1970), pp. 39-40, 72 (Al-liance). Furthermore,n 1954the cepalista conomist Celso Furtadoapplied Prebisch'sargument n international erms f tradetoproblems of nterregional rade nBrazil,and therebyhelped justify he creation of the Superintendency fDevelopment ofthe Northeast SUDENE). A similar analysis of the Northeast's terms of tradewasmade independentlyand more or less simultaneously by Hans W Singer,whosetheorieson international rade paralleledPrebisch's see below).

3. Brazilian Embassy,Washington,D.C., Boletim special,no. 31, 21 June1977, p. 1.

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4. In 1918, uisGondra ntroducedouthAmerica's irst oursenmathematicalco-nomics t theUniversityf BuenosAires.Gondraet al., El pensamientocon6micolatinoamericanoM6xico: ondode Cultura con6mica,945), . 32.

5. Prebischnterview, ashington,.C., 10July978.6. Prebisch,Anotacionesemogrdficasprop6sitoe losmovimientose la poblactonBuenosAires:n. pub.,1926), . 3.

7. Duhau, Pr6logo, in Prebisch, ed., Anuariode la SociedadRural Argentina, o. 1(BuenosAires:Gotelli, 928), . vii.

8. Among therworks, rebisch's rticlesn the1920s ublishedntheRevistaeCien-ciasEcon6micasnclude la conferenciainancieranternacionale Bruselas 1921);Anotacionesobrenuestromedio irculante1921-22);Anotacionesobre-larisis

ganadera 1922); La cajainternacionale conversi6n 1923); nd El regimen epoolen elcomercioe carnes 1927).

9. Who'sWho n theUnitedNations ndRelatedAgenciesNew York:ArnoPress,1975),pp.455-56;Prebisch, Versi6n aquigrafica e la conferencia e prensa . . 15 de

noviembree 1955, p. 23-24 Prebischile, CLA,Santiago, hile);CarlosF.DiazAlejandro,Essays ntheEconomic istory f heArgentineepublic New Haven, Conn.:YaleUniversityress, 970), . 97;BancoCentral e laRepublica rgentina,acrea-ciondelBancoCentral a experiencia onetariargentinantreos fnos935-1943 BuenosAires: BancoCentral], 972),1:267 t seq. The ast-named orkdetails hediffer-ences n theNiemeyerlan ndthat ctuallydopted ytheArgentineovernment.(Niemeyer as also an advisor oBrazil, nothermajorrecipientfBritishapital,andplayed similarole nthe astcoast fSouthAmericahat heAmericaninan-cialadvisor, dwinKemmerer,idonthewestcoast-whereU.S. investmentre-dominated.)

10. For xample,eeRichard . CavesandRonaldW.Jones,WorldradendPayments:nIntroduction,ded. (Boston: ittle, rown, 977), p. 12,109.For notherummary,

see FemandoH. Cardoso, TheOriginalityfa Copy: CEPALandthe dea ofDe-velopment, EPALReview2dhalf f1977, UN:ECLA]),4,pp. 9-10.11. DiazAlejandro,ssays, . 2.12. RodolfoPuiggr6s,Historia ritica e ospartidosoliticosrgentinosBuenosAires:Edito-

rialArgumentos,956), . 276;PeterH. Smith,oliticsndBeefnArgentina:atternsfConflictndChangeNewYork: olumbiaUniversityress,1969), p. 52,74-75.Aslate s 1940, inanceMinisterederico inedohadtodefend hepromotionf ndus-trial roductioneforeheArgentineenate ydistinguishingetweennatural n-dustries, orwhich henation adthenecessaryawmaterials,nd artificialndus-tries, orwhich t lacked nputs.Javier illanueva, EconomicDevelopment, nMark Falcoff nd Ronald H. Dolkart,eds., Prologue oPer6n:Argentinan DepressionandWar: 930-1943Berkeley: niversityfCaliforniaress,1975),p. 78. All the

same,the ountry'sarifftructureas so complexconfused?)hat iaz Alejandrobelieves hat on balanceprotectionistndrevenue onsiderationsrevailed verfree rade entimentetween 906 nd1940 Essays, . 307).Perhaps ooneintheperiod nderstoodhenet ffectsf he ariffystem;nany vent, evenuemayhavebeentheprimary otive or ariffevels, ndfrom916 o1930,Radical overrunentsfavored he ociedadRural ver ther roupsntheirariffolicy.Onthe astpoint,see CarlSolberg, The TariffndPoliticsnArgentina:916-1930, ispanic mericanHistorical eview 3, 2 [May 1973], p. 284.)

13. CharlesP.Kindleberger,heWorldepression:929-1939London:Penguin, 973),pp. 102,104;ECLA, TheEconomic evelopmentfLatinAmerica nd tsPrincipal roblems(LakeSuccess,N.Y.:UnitedNations, 950), . 29.

14. Kindleberger,World epression, . 181.

15. Jorge odor ndArturo . O'Connell, La Argentina la economia thlntican laprimeramitad elsigloXX, esarrollocon6mico3,9 (Apr.-June,973), p. 18,30.16. D. M. Phelps, IndustrialExpansion n Temperate outhAmerica,American

Economic eview 5 (1935), pp. 273-74.

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17. Data in Vicente Vasquez-Presedo, Crisisy retraso: rgentina la economianternacionalentreasdosguerrasBuenosAires: UDEBA,1978), p. 253,272.

18. Fodor nd O'Connell, La Argentina, p. 52-54. Britain as to eliminateariffsn

cereal mports, uttheemphasiswas on beef.Argentinalso agreed o spend allsterlingums arned n tradewith heUnitedKingdom. illanueva, Economic e-velopment, p. 65-66.On thenegotiations,ee Joseph . Tulchin,Foreign olicy,in Falcoffnd Dolkart, rologueoPer6n,p. 91-98.

19. When heWar egan nSeptember 939, secret actbetween heBank fEnglandandArgentina'sentral ank stablishedhat he outhAmerican ationwould c-cept terlingor ts ales toBritain,ndthat hismoneywouldbeused exclusivelyorpaying or ritishxportsoArgentinartobuybackArgentineonds ndpurchaseBritish-ownedailways.hat s,the terling as held na blockedccounthat ouldnotbe convertednto ther urrencies,nd would constituteaymentsn a captiveexportmarket orBritishoodsafter heWar.No interest as to bepaidonthis c-count, nd Britain idnothave touse itsprecious ollars,whichArgentinaorely

needed.Accordingo Fodor ndO'Connell, During his eriod andfor time fterthe1943 oup] . . Argentinaid notuseits terlingo iquidatetsforeignebtnorto buyup [British-owned]ailroads, ith heresult hatwhileArgentina'sebts oBritain aid nterest, ritishebts o Argentinaid not. Argentina as apparentlywilling o accept he opsidedpactof 1939because of thecollapseof cerealpricesagainattheoutset ftheWar, nd theprobableoss of herremainingontinentalmarketss the onflicteveloped.) ven nthepostcoup ears i.e.,after rebischefttheCentral ank), hepro-Axis ovemmentontinued o bowto theeconomic e-mands fBritain,or ear f osing tsonly argemarket.odor ndO'Connell, LaArgentina, p. 56 quotation),7,59.

20. ECLA, External inancing n LatinAmerica New York:U.N., 1965), p. 25. Argentinadid defaultnsomeof tsnonfederalebts.

21. Prebisch,Versi6n, . 28;Prebischnterview.22. Prebisch, La conferenciacon6mica la crisismundial, n [Bancode la Naci6nArgentina],evistacon6mica1,1 (Jan. 933), p. 1,3.

23. Prebisch nterview;Keynes, TheCollectedWritingsfJohnMaynardKeynes (London:Macmillan, 972), p. 335-66, sp.360.

24. Prebisch,La inflaci6nscolastica a moneda rgentina, evistaeEconomiargen-tina, no 17,no. 193 July934),pp. 11-12;no. 194 Aug. 1934), . 60. Latertwasdiscoveredhat hepurchasingower fArgentina'sxports ell y bout 0 percentbetween 925-29 nd 1930-34.Between hese woperiods he apital lowwas alsoseverely urtailed,o Argentina'sapacityo mport elln1930-34 o 46 percent fwhat thad been n thepreceding iveyears.Aldo Ferrer, heArgentineconomy,r.Marjory . Urquidi Berkeley:niversityfCaliforniaress, 967), . 162.

25. See Villanueva, EconomicDevelopment ;Diaz Alejandro, ssays,pp. 94-105;Vasquez-Presedo, risis retraso,p. 137-86; nd nparticular,ogerGravil, StateInterventionnArgentina'sxport rade etween heWars, ournalf atin mericanStudies,2 (1970), p. 147-73; ndRafaelOlarraJimenez,voluci6n onetariargen-tinaBuenosAires: UDEBA,1968), p. 83-99 nd passim.

26. Gravil, State ntervention, . 171;Wilfred alenbaum, heWorld heat conomy:1885-1939Cambridge, ass.:HarvardUniversityress, 953),pp. 205-9.A state-ment yPrebisch nArgentina'sole s foundnan interview e gave during heRoca-RuncimanegotiationsnLondon.See La Prensa, Feb. 1933, . 9.

27. Kindleberger, orldepression,p. 278-79.28. WalterBeveraggi-Allende,Argentine oreignTrade under ExchangeControl

(Ph.D. thesis, arvard niversity,952), p. 219 quotation),46.

29. Phelps, Industrial xpansion, . 274;Economiceviewi.e., English d. ofRevistaEcon6mica],eries , 1,no. 1 (1937), . 69.30. Phelps, Industrialxpansion, . 281.31. Banco Central e la RepublicaArgentina, emoria. . 1942 BuenosAires:Banco

Central, 943), p. 30-31.

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52. Benjamin Higgins, UnitedNations nd U.S. Foreign conomic olicy Homewood, Ill.:Irwin, 1962), p. 102; C. C. Stewart, Center-Periphery nd Unequal Exchange [Afri-can Section], paper presented at the Seventh National Meetingof the Latin American

Studies Association/Twentieth nnual Meeting of the African tudies Association,Houston, Texas, Nov. 1977, p. 4.53. Aldo Ferrer nterview, uenos Aires, 2 Aug. 1978.54. Prebisch nterview.For support of the League's lack of interest n underdeveloped

areas, see H. W. Arndt, Development Economics before1945, n JagdishBhagwatiand RichardS. Eckaus, eds., Developmentnd Planning Cambridge,Mass.: MIT Press,1973), p. 18.

55. Albert 0. Hirschman, Ideologies of Economic Development in Latin America, nHirschman, ed., Latin American ssues: Essays and Comments New York: TwentiethCenturyFund, 1961), p. 13.

56. United Nations: Departmentof Economic Affairs, elative rices fExports nd mportsof Under-Developedountries: Study fPostwar erms fTrade etween nder-Developed

andIndustrialized ations Lake Success, N.Y: United Nations, 1949), p. 7.57. ECLA, Economic evelopment, p. 8-14.58. Ibid., pp. 15-16; ECLA, Economic urvey fLatinAmerica: 949 New York:United Na-

tions, 1951), pp. 20, 35-38.59. H[ans] W. Singer. The Distribution of Gains between Investing and Borrowing

Countries, American conomic eview:Papers nd Proceedings0, 2 (May 1950), pp.473-85 (quotation fromp. 479). Income elasticity f demand for good refers o therelative esponse of demand to a small percentage hange in income Aq , where q isthe quantitydemanded, and y is disposable income). ay/y

60. Prebisch to author,29 June1977; Singer to author,Brighton, ngland, 21 Aug. 1979.61. E/CN.12/221 18 May 1951), p. 30.62. ECLA, Economic urvey 949, p. 59. More ambiguously,Economic evelopmenttated

that the income of entrepreneurs nd of productivefactors n the center ncreasedfaster han did productivityn the centerfrom he 1870sto the 1930s, but in anotherpassage the document placed exclusive emphasis on therole of wages in the center(pp. 10, 14).

63. Samir Amin, Accumulationn a World cale:A Critique f heTheory fUnderdevelopment,tr.BrianPierce New York:MonthlyReview Press, 1974), 1: 83-84.

64. ECLA, Economic evelopment, . 48.65. U.S. Departmentof State,Havana Charter or n International radeOrganizationnd

Final Act and RelatedDocuments Dept. of State pub. 3117, Washington,D.C., n.d.),pp. 39-43; Singerto author,21 Aug. 1979.

66. AlejandroE. Bunge,La economiargentinaBuenos Aires: Cia. Impresora Argentina),2 (1928), pp. 229-31; 4 (1930), p. 131 Carl Solberg brought hiswork tomy attention);

Tulio Halperin Donghi, Argentina: ensayo de interpretaci6n, n RobertoCortesConde and StanleyJ.Stein, eds., LatinAmerica:A Guideto Economic istory, 830-1930 (Berkeley:University f CaliforniaPress, 1977), pp. 67, 115.

67. League ofNations: Economic Financial and TransitDepartment,Commercialolicynthe nterwar eriod: nternationalroposalsnd NationalPoliciesGeneva: League ofNa-tions, 1942), p. 133.

68. HarryG. Johnson, The Ideologyof EconomicPolicy n the New States, nJohnson,ed., Economic ationalismn Old and NewStates Chicago: University fChicago Press,1967), pp. 131-32 (Carl Solberg broughtthis work to my attention).Rosenstein-Rodan, forexample, wrote in 1943 thatthe market ystem n SoutheasternEuropedid not by itself transform easants into workers;he believed that Engel's lawpointedtothedead end ofagricultural xports, nd advocated a state-induced ndus-

trialization rogramthat would result n theexportof ndustrialgoods. He also rec-ognized thevalue of ndustrialization s an employmentpolicyfor heunemployedor underemployedrural masses. See Problems of Industrialization fEasternandSoutheasternEurope, in A. N. Agarwala and S. P. Singh,eds., The EconomicsfUn-

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derdevelopmentLondon:Oxford niversityress, 958),pp. 246,253-54. Originallyin Economicournal.)

69. Daniel Chirot, Neoliberal nd Social Democratic heories fDevelopment:The

Zeletin-VoineaebateConcerningomania's rospectsnthe 920s nd tsContem-porary mportance, n Kenneth Jowitt, d., Social Change nRomania, 860-1940:ADebate on Developmentn a EuropeanNation (Berkeley: Instituteof InternationalStudies, 978), . 44. Alsosee note 6ontheRumanianMarxistobrogeanu-Gherea.

70. Viner,nternationalradendEconomicevelopmentGlencoe, 11.:reePress, 952) aseries f ectures eliveredn RiodeJaneiron1950], p. 61-64;Schmitter,Still heCenturyfCorporatism?,heReviewf olitics6,1 (an. 1974), . 119.

71. MihailManoilesco, Theorie u protectionnismet de t'change nternationalParis:MarcelGiard, 929), p.61,65,184;Le i2cle ucorporatisme:octrineucorporatismentegraltpur Paris: elixAlcan,1934), . 28. See a general iscussionf theManoilesco r-gument hat abor houldbemoved utof subsistencegriculturento ndustrynW M. Corden,Recent evelopmentstttheTheory f nternational rade Special Papers

in Intemationalconomics o. 7] (Princeton, .J.:Dept. of Economics, rincetonUniversity,965),pp. 60-61.Cordenattributesthemodern evelopmentftheManoilesco rgument oW.Arthurewis, . E. Hagen, ndHlaMyint, ot oECLAeconomists.

72. Manoilesco, Theorie, . 184; Le si&le,pp. 28-30.73. Theorie, p. 261-62.74. MarioPugliese,Nacionalismocon6mico,omercionternacionalilateral,indus-

trializaci6nelos paises gricolas, esdeel punto e vista e laeconomiargentina,RevistaeCienciascon6micas,nlo 7,serie ,no. 219 Oct.1939), . 917;Luis RoqueGondra, El teoremaicardianoe los costos omparados, CE,anlo 5,serie ,no.194 Sept.1937), . 810. nArgentina, anoilesco'sworkswereusually ited obeat-tacked; hey eemto have been muchmore nfluentialnBrazil,where heywere

championed ythe ndustrialistnd publicist oberto imonsen.Manoilesco lsocorresponded ith ao Paulo'sCentro as Induistrias.ee Simonsen,Amargemaprofiss.ioSao Paulo: Sao Paulo Editora, .d.), pp. 250-51;Manoilesco, eoriaopro-teccionismoda permutanternacionalSao Paulo: Centro das Industrias, 931),pp. 5-6.

75. Manoilesco, e i2le, p. 33, note .76. Constantinobrogeanu-Gherea1855-1920),RumanianMarxist,istinguishede-

tween global ocietynd local societies. e used theformererm odescribe hedynamic apitalist ations,n a way roughlyquivalent o Prebisch's enter;ocalsocieties, group f feudal, ependentountries, eresimilarotheperiphery.Gherea's dWe aitresse,ccordingo HenriStahl,was thatRumanian ociety's e-velopmentouldnot be understoodxcept s a fragmentf an expandingworldcapitalistystem. side fromGherea'swork,Marxist exts n imperialismefore

WorldWar reveal ittle nterestn underdevelopments imperialismeen frombelow. n theview fFredGottheil,or enin,Kautsky,uxemburg,ndHilferding,Thecolonized egionswere egardedimplysdepositoriesor apitalism'surplus

commodities,abor, nd capital.Whateverecame fthese urplusesn theregions... was clearly eripheralotheir nterest. etLenin'sposition eganto changeafterheSoviets eizedpower, ndthis actwasreflectednthepronouncementsftheCommunistnternational,searly s its econd ongressn 1920.At ts ixthon-gress n1928 heCominterneclared apitalismncolonial reasto be a reactionaryforce, ecausecapitalistslliedwith ompradorourgeoisiesnd other raditionalgroups.As PaulSingernotes, his nalysis roughtntofocus or hefirstime herelationsf ocial lasses nunderdevelopedountries.

Prebischn theearlyyears f ECLA hadnothingosayabout lassrelation-

ships ntheperiphery;uthisemphasis nrelativerices etweengriculturalndindustrialoodshada precedentmong oviet heoriststhough nce gain here sno indicationfany nfluencen Prebisch's hinking).refero the Soviet ndus-trializationebatebetween 924 nd1928, esultingnStalin's ecisionnthe atteryearto develop heavy ndustrynd to collectivizegricultures partof theFirst

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Five-Year lan.Evgeni reobrazhenski,n advocate frapid ndustrializationuringtheperiod f the semi-capitalist ewEconomic olicy 1921-28), ontended hatthe agriculturalector hould subsidize ndustrial evelopmentn theU.S.S.R.,

through pricing olicy or ndustrial oods on thebasis ofmonopoly, s Preob-razhenski ut t. Thiswas part fwhatPreobrazhenskialled socialist rimitivec-cumulation, he allegedlymorehumane ounterpartf the capitalist rimitivec-cumulation escribed ith uch passion n chapters 6 and 27 ofMarx'sCapital. ttheendof the 1920s, ollectivizationerminatedhe peasants'freedom o choosewhenand at whatterms o sell their urpluses.n Prebisch's cheme, nequalex-changebetween griculturalnd industrial roducersargely ccurs hroughheaction fthebusiness ycle, ut, s wehave een,monopolisticricing layed omerole.

Onthesematters,ee HenriH. Stahl, Theories e C. D. Gherea ur es oisdela penetrationu capitalisme ans les pays retardataires,eview of he FemandBraudel nstitute], 1 (Summer 978),pp. 106,108-09;FredM. Gottheil,On an

Economic heory f Colonialism, ournalfEconomicssues , 1 (Mar.1977),p. 93;PaulSinger, Divisao ntemacionalo trabalho empresasmultinacionais,n CEB-RAPCaderno8: Multinacionais:nternacionalizaSaocriseSao Paulo:Brasiliense,977),pp. 55-56 Albert irschmanroughthis rticleo my ttention);nd Alexander r-lich,The ovietndustrializationebate, 924-1928Cambridge, ass.: HarvardUni-versity ress, 960), p. 49, 50, 55, 121.

77. Sombart, ermoderneapitalismus,II: Das WirtschaftslebenmZeitalteresHochkapita-lismus,rster albbandMiinchen, 928), p. xiv-xv.

78. Ibid.,pp. 64; zweiter albband, . 1019.79. Prebisch o author,Washington,.C., 26 June 979.We may lso note n this oint

thatWilliamA. Brown,Jr., n American conomist, sed the terms enter ndperipheryn1940with espectothe nternationalold tandard: The center oun-

tries,by theveryfactof theirdominationfthe world, an never hift o theperiphery,nd theperipheryountries ave toconsiderhesum total f their ela-tions o this entralystem f exchange] atesndeterminingheir urrencyolicy.Again, he ermsonotfiguren a cyclicalheory,utBrown'sworkwas nanarea nwhichPrebischwas reading n the early 940s.See Brown,The nternationaloldStandardeinterpreted:914-1934NewYork:National ureau fEconomic esearch,1940) : 862. PaulDrakebroughthiswork o my ttention.)n1977 rebisch idnotrecall ow he came ouse the erms enterndperiphery.rebischo author,9June1977.

80. Hirschman,A Generalized inkageApproach oDevelopment, ith pecialRefer-ence to Staples, conomicevelopmentndCulturalhange 5,1977 upplement,.68. Samuelson's rticleswere Internationalrade nd theEqualisation f Factor

Prices, conomicournal8 (une 1948),pp. 163-84 nd Internationalactor-PriceEqualisationnceAgain, conomicournal9 June 949), p. 181-97.

81. Viner,nternationalrade,specially p. 61-62;Prebischoauthor,9June 977.82. The database for ritain), hich howed ong-termeteriorationf heperiphery's

termsf rade,was criticized:t llowed or ochangenthe ualityfgoods, pro-cess that resumablyffectedndustrial ore han griculturalommodities,ecauseofa higher ate f echnologicalrogressn the enter. urthermore,.T.Ellsworthpointed utthat heBritisheriesncludedxports .O.B.but mports .I.F.,and ar-guedthat fallntheprices fprimaryoodsfrom 876 o 1905waslargely ue to afall ntransportationosts owing o a combinationf dvancesnsteamshipnd railnetworks). utthe same writerhowedthat heevidence or he 1930s upportedPrebisch-Britishxport rices id notfall ecause fresistanceo cuts n wages nd

profits.Usingdatafor heperiod1950-60,Werner aer showed hat herewas sub-stantialvidence hat hedeteriorationf he ermsf radenmany arts f heun-derdeveloped orld wed to ow ncome lasticityfdemandfor tscomplement'sgoodsat thecenter,ndhigh lasticityttheperiphery. hile cknowledginghat

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monopolisticricingtthe enter as difficultoprove,Baerfound hat or 950-60the periphery'sxport rices ended o decrease r tofluctuate idely.Wages inconstanterms)or heyears 950-59 ose n selected enterountries,hile hosen

peripheralountriesell.More ecentlyaulBairoch as attacked rebisch'serms-of-tradergumentsa long-term henomenon. airoch ontends hat, ontraryo Prebisch, rimarygoodsbenefitedn the ecular rendsf he ermsf rade rom 870 o the arly 950s.Tobeginwith, airochhallengeshe hoice f he erminalear1938) f he riginalU.N. study Relativerices) s anabnormalne. He alsocites rade iguresor heUn-itedStates ndFrance data not vailablen 1949),which iverge rom hetrendsftheBritishxperienceRobert ipseyhad already hown his or heU.S.). Further-more,Bairoch emonstrateshat he nternalerms f tradefor everal evelopedcountriesmoved nfavor f agriculturaloods ntheyears 876-80 o 1926-29. i-nally, ecitesong-termtudies f ermsf rade or everal rimary-exportingoun-trieswhich ontradictheU.N.'sfindings. etBairoch oes thinkhe ermsftrade

moved gainst heThirdWorld ountries rom954-55 o1962-63.Among he ev-eralcauses ofthis rendwas a factorrebisch ad cited- a differenceetween heless-developedndthedeveloped ountriesn themannernwhich hegainsfromincreased roductivityccrued. espiteBairoch's orcefulrgumentsn the ong-termrends, hedispute bout he ffectsfterms ftrade etween eveloped ndunderdevelopedountriesemained erymuch live n theyearhe published1975).

SeeEllsworth,TheTerms fTrade etween rimaryroducingnd ndustrialCountries,nter-Americanconomicffairs0, 1 (Summer 956), p. 55-57, 3:Baer,The Economics fPrebisch nd ECLA, in CharlesT. Nisbet, d., LatinAmerica:

Problemsn EconomicevelopmentNewYork: reePress,1969), p. 215-17;Bairoch,The Economic evelopmentf heThirdWorld ince1900 Berkeley:University f Califor-nia Press, 975), p. 111-34, specially20,125,132,134 quotation); obert . Lip-

sey, Price nd Quantity rends n theForeign rade f the United tates Princeton,N.J.:Princetonniversityress, 963), specially p. 12-17; Idea of Growing isparityin World ricesDisputed, NewYork imes, 5 May 1975,pp. 1, 8; Jonathanower,OfRaw Materials, aw Statistics,ndRaw Deals, NewYorkimes, 1 Aug. 1975, .

E15.83. Joseph . Love, Centro-Periferiatroca esigual:Origens crescimentoe uma

doutrinaconomica, ado19 1978), p. 47-62, specially6-57.84. Amin, Accumulation: 609-10.85. OctavioRodriguez, Sobre a concepci6n el sistema entro-periferia,evistae a

CEPAL 1sthalf f1977), . 240.86. See note76.87. Prebisch,Acritique, p. 11-12, 7,60,66. Prebisch efineshe urplus s thegains

inproductivityesultingromechnologicalrogressp. 13).88. Ibid.,p. 59.

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Raul Prebisch and the Origins of the Doctrine of Unequal Exchange-1980

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