Commodity Chains, Unequal Exchange and Uneven Development

Cem Somel ()
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Cem Somel: Department of Economics, METU

No 411, ERC Working Papers from ERC - Economic Research Center, Middle East Technical University

Abstract: 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.

Keywords: Unequal exchange; development; commodity chains (search for similar items in EconPapers)
JEL-codes: F02 F2 F4 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2004-09, Revised 2004-09
New Economics Papers: this item is included in nep-ifn
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http://erc.metu.edu.tr/en/system/files/menu/series04/0411.pdf First version, 2004 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:met:wpaper:0411

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