Mr Prebisch on the asymmetric Gold Standard[Import substitution in high-tech industries: Prebisch lives in Asia!]

Prebisch is responsible for three significant but often ignored contributions to international macroeconomics. First, Prebisch characterised the Gold Standard as an unstable and asymmetric system, which worked for peripheral countries only when there was a balance of payments surplus. Second, Prebisch considered that the increasing importance of the US economy was the main reason for the collapse of the Gold Standard and the Great Depression, and rejected explanations based on the inflexibility of wages and prices. Third, and as response to the abovementioned issues, Prebisch implemented several policies in Argentina during the 1930s, lifting the country out of the crisis. These theoretical insights and the policy prescriptions predated significant contributions by eminent scholars and proved to be successful during the last decades.