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Prebisch-Singer Redux

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Author Info
John T. Cuddington
Rodney Ludema
Shamila A Jayasuriya
Abstract

In light of ongoing concern about commodity specialization in Latin America, this paper revisits the argument of Prebisch (1950) that, over the long term, declining terms of trade would frustrate the development goals of the region. This paper has two main objectives. The first is to clarify the issues raised by Prebisch and Singer (1950), as they relate the commodity specialization of developing countries (and Latin America in particular). The second is to reconsider empirically the issue of trends in commodity prices, using recent data and techniques. We show that rather than a downward trend, real primary prices over the last century have experienced one or more abrupt shifts, or “structural breaks,” downwards. The preponderance evidence points to a single break in 1921, with no trend, positive or negative, before or since.

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Paper provided by Central Bank of Chile in its series Working Papers Central Bank of Chile with number 140.

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Date of creation: Feb 2002
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Handle: RePEc:chb:bcchwp:140

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  13. Cuddington, John T., 1992. "Long-run trends in 26 primary commodity prices : A disaggregated look at the Prebisch-Singer hypothesis," Journal of Development Economics, Elsevier, vol. 39(2), pages 207-227, October. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Jose Antonio Ocampo & Maria Angela Parra, 2004. "The Terms Of Trade For Commodities In The Twentieth Century," International Trade 0402006, EconWPA. [Downloadable!]
  2. Christian Gillitzer & Jonathan Kearns, 2005. "Long-term Patterns in Australia's Terms of Trade," RBA Research Discussion Papers rdp2005-01, Reserve Bank of Australia. [Downloadable!]
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