THE UNDERDEVELOPMENT PERSPECTIVE

• Trade and global integration do not guarantee growth or development.



• Since lesser-developed countries tend to trade in primary products the terms of trade move against them.



• The problem of elasticity pessimism.



• The market for primary products is more unstable than that for manufactured goods.



• Trade does not transform LDC economies, it only deepens their specialization. If terms of trade move against LDCs, then earnings from exports may only be enough to finance imports but not domestic industrialization.



• LDCs do not set down the international rules of trade.



• "Development" requires equity, and LDC growth has never guaranteed equity. (Table)