Commodity Chains, Unequal Exchange and Uneven Development
Research shows an uneven partition of value added along commodity chains between transnational firms and producers in developing countries. This paper briefly discusses how such a distribution occurs and how it leads to unequal exchange in trade. A North-South trade model reveals the uneven development consequences of this exchange. The terms of trade between North and South help maintain a gap in capital accumulation between the two regions. The model reveals that capital flows covering the trade deficit of the South with the North may help stimulate the unrequited transfer of real resources from South to North.
|Date of creation:||Sep 2004|
|Date of revision:||Sep 2004|
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Department of Economics
98-06, California Davis - Department of Economics.
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