[lbo-talk] Re: New Imperialism?

[Seth Ackerman]

John Mage wrote:

>
> Doug,
> Or to put it another way, do you contend either that Prebisch-Singer
> were wrong, or that their findings for the period before 1950 have not
> in fact been even more true in the last half century?
> john


Prebisch-Singer never argued that rich countries were rich because of 
unequal terms of trade. They argued that poor countries were poor for 
that reason. If the United States had continued to specialize in grain 
and cotton after the Civil War, we too would be poor today. I don't 
think anyone would argue that we industrialized (say, from 1865-1898) 
because we were imperialist. We became a lot more imperialist *after* we 
industrialized (and probably because of it).

And I think the consensus in economic history is that the P-S 
statistical argument was wrong. Over the long term, there is no clear 
trend in net barter terms of trade. Right now, by the way, I bet NBTT is 
trending strongly in favor of poor countries: commodity prices are 
booming because of China, while manufactured products are experiencing 
low inflation. Yet imperialism abounds. And lately its main economic 
consequence has been, of all things, to raise oil prices so Hugo Chavez 
can consolidate the Bolivarian revolution!

I think Prebisch missed the point. It's not that a unit of raw materials 
buys less and less manufactured goods. It's that an hour of labor spent 
producing raw materials yields less and less relative to what an hour of 
labor producing mfgs yields. Because of productivity growth in mfg, an 
hour of labor yields more and more, while primary industries just aren't 
capable of much productivity growth.

Seth