Prebisch’s ideas on the world economy

This article identifies three main phases in the evolution of Prebisch’s ideas on the international economy. During the first of these, he outlined his concept of the centre-periphery system and its role in the fundamental structural disequilibria of peripheral countries, with particular attention to their propensity to deficits and indebtedness and the trend towards a deterioration in the terms of trade of the primary commodities they exported. He also brought out the repercussions of their narrow specialization in primary activities, associated with adherence to the principle of static comparative advantage.