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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Moominoid who wrote (36978)	7/15/2008 7:01:39 PM
From: elmatador	Respond to of 219931

The Classical Law of Rising Terms of Trade of Primary Products The classical economists believed that the terms-of-trade of primary products would show long-term improvement vis-à-vis manufactures due to the operation of the law of diminishing returns in primary production and the law of increasing returns in manufactures. The policy implication of this classical proposition is that a primary-producing country need not industrialize to enjoy the gains from technical progress taking place in manufactures; free play of international market forces will distribute the gains from the industrial countries to the primary-producing countries through the higher prices of their exports of primary products relative to the prices of their imports of manufactures (that is, the terms-of-trade will move in favor of primary-product exporting countries). www.geocities.com/prabirjit_sarkar/ps.doc The Prebisch-Singer Hypothesis counter argue that. The way I look at it, closed economies of LATAM (Prebisch was Argentinean) created the conditons against the "free play of international market forces will distribute the gains from the industrial countries to the primary-producing countries". That created lots of profits for the protected industries (Getulio in Brazil Peron in Argentina) and the state-owned enterprises, but worked against the "distribution of the gains from the industrial countries to the primary-producing countries". Today, we are seeing the distribution happening and this points to the structural chanage that I keep talking about.

To: Moominoid who wrote (36978)	7/15/2008 7:32:51 PM
From: elmatador	Respond to of 219931

What passes as economic cycles are nothing less than the study of the rising of science and technology. Because science and technology was so important -from 1800 onwards- and had so dramatic effects, their impact is seem by economists as cycles. But there aren't any cycles. Here is why: Once the economy plateaus, after a certain discovery reaches maturity, (say steam engine, another discovery comes along and crates another impulse, (for example electrical motors) economists see as another cycle. There were no cycles there. There were only gains as a new technology raised productivity and availability of a good. Fast Forward for today: The last 22 years we saw dramatic drop in the prices of processing power and memory. A plethora of products and new technologies were possible. Cheapens telecoms, (prompts Elmat to pole-climb). Makes possible spread of information, which is taken advantage of by the shirtless... This is also a "cycle".