LONG-RUN TRENDS IN THE RELATIVE PRICE OF PRIMARY COMMODITIES AND IN THE TERMS OF TRADE OF DEVELOPING COUNTRIES
- 1 July 1993
- journal article
- research article
- Published by Oxford University Press (OUP) in Oxford Economic Papers
- Vol. 45 (3) , 349-363
- https://doi.org/10.1093/oxfordjournals.oep.a042096
Abstract
The long-run trend in the ratio of primary product prices to those of manufactured goods is examined in the context of an error correction model. The ratio was approximately stable from 1925 to 1980, after which there was a significant drop. However, the separate component series (metals, food, non-food 'soft' commodities) display marked dissimilarities. This casts doubt on generalisations about the relative price of primary products as a group, and helps to explain disagreement amongst previous authors. The relationship between relative prices and the terms of trade of developing countries is examined and the policy implications discussed.This publication has 6 references indexed in Scilit:
- The Prebisch-Singer Hypothesis: A Reappraisal Independent of Stationarity HypothesesThe Economic Journal, 1992
- Commodity and Developing Country Terms of Trade: What Does the Long Run Show?The Economic Journal, 1991
- Trends and Cycles in the Net Barter Terms of Trade: A New ApproachThe Economic Journal, 1989
- The long-run determinants of North-South terms of trade and some recent empirical evidenceWorld Development, 1987
- The terms of trade experience of Britain since the nineteenth centuryThe Journal of Development Studies, 1986
- The Statistical Debate on the Net Barter Terms of Trade Between Primary Commodities and Manufactures: A Comment and Some Additional EvidenceThe Economic Journal, 1985