International Trade Theory in a Developing World: Proceedings of a Conference held by the International Economic Association

585 Pages·1963·59.44 MB·English

by  Roy Harrod, Douglas Hague (eds.)

INTERNATIONAL ECONOMIC ASSOCIATION
CONFERENCE VOLUMES. Numbers 1-50
NUMBER 13
International Trade Theory in a
Developing World
INTERNATIONAL
TRADE THEORY IN A
DEVELOPING WORLD
Proceedi'ngs of a Conference
held hy the Internati'onal Economi'c Assodati'on
EDITED BY
ROY HARROD
ASSISTED BY
DOUGLAS HAGUE
M
. .
S
TOCKTON
P R E S S
© International Economic Association 1963
Softcover reprint of the hardcover 1st edition 1963 978-0-333-40641-0
All rights reserved. No reproduction, copy or transmission
of this publication may be made without written permission.
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or transmitted save with written permission or in accordance
with the provisions of the Copyright Act 1956 (as amended).
Any person who does any unauthorised act in relation to
this publication may be liable to criminal prosecution and
civil claims for damages.
First published 1963
This 50-volume set reprinted 1986 jointly by
THE MACMILLAN PRESS LT O
Houndmills, Basingstoke, Hampshire RG21 2XS
and London
Companies and representatives
throughout the world
and
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Published in the United States and Canada by
STOCKTON PRESS
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50-volume set ISBN 978-0-333-40626-7
ISBN 978-1-349-08460-9 ISBN 978-1-349-08458-6 (eBook)
DOI 10 . 10 07/978-1-349-08458-6
CONTENTS
PAGB
LIST OF PARTICIPANTS vii
INTRODUCTION xi
CHAP.
1. SoME REcENT TRENDs IN THE PuRE THEORY OF INTER-
NATIONAL TRADE. J. N. Bhagwati 1
2. RECENT TRENDS IN WoRLD TRADE. A. Maizels 31
3. TRENDS IN TERMS OF TRADE, AND THEIR REPERCUSSIONS
ON PRIMARY PRODUCERS. T. Morgan 52
4. EFFECTS OF CHANGES IN COMPARATIVE COSTS AS INFLUENCED
BY TECHNICAL CHANGE. H. G. Johnson 96
5. DESIRABLE INTERNATIONAL MOVEMENTS OF CAPITAL IN RELA
TION TO GROWTH OF BORROWERS AND LBNDBRS AND GROWTH
OF MARKETS. R. F. Harrod 113
6. INTERNAL STRUCTURAL CHANGES REQUIRED BY GROWTH AND
CHANGES IN INTERNATIONAL TRADE. M. Bye 142
7. INFANT INDUSTRY ARGUMENTS FOR AssiSTANCE TO INDUSTRIES
IN THE SETTING OF DYNAMIC TRADE THEORY. H. Myint 173
8. REGIONAL FREB TRADE : TRADE-CREATING AND TRADE-DIVERTING
EFFECTS OF PoLITICAL, CoMMERCIAL AND MoNETARY AREAS.
H. H. Liesner 194
9. THE THEORY OF COMMON MARKETS AS APPLIED TO REGIONAL
ARRANGEMENTS AMONG DEVELOPING CouNTRIES. R. F.
Mikesell 205
10. FoRMs oF INTERNATIONAL EcoNOMIC RELATIONS WHICH
INFLUENCE DEVELOPMENT OF WoRLD TRADE. A. Bechin 230
11. INTERNATIONAL TRADE AND TRADE CYCLES, 1950-60.
A. Lamfalussy 241
12. ECONOMIC PRINCIPLES OF THE FOREIGN TRADE OF SOCIALIST
STATES. V. P. Sergeyev 277
v
Contents
CHAP. PAGB
13. ECONOMIC GROWTH AND BALANCE OF PAYMENTS PROBLEMS.
K. M. Savosnick 297
14. TRADE AND PAYMENTS POLICY FOR A DEVELOPING ECONOMY.
I. G. Patel 309
15. ExiSTING INTERNATIONAL PAYMENTS AND ExcHANGE SYSTEMS
IN RELATION TO PROBLEMS OF GROWTH: I. J. Weiller 332
16. EXISTING INTERNATIONAL PAYMENTS AND ExcHANGE SYSTEMS
IN RELATION TO PROBLEMS OF GROWTH: II. D. J. Delivanis 354
17. THE PROSPECTS FOR INTERNATIONAL LIQUIDITY AND THE FUTURE
EVOLUTION OF THE INTERNATIONAL PAYMENTS SYSTEM.
C. P. Kindleberger 372
REPORT ON THE PROCEEDINGS
SuMMARY REcoRD OF THE DEBATE. D. Hague 393
lNDEX 565
vi
LIST OF PARTICIPANTS
Professor 0. D' Alauro, Facolta di Economia e Commercio, Univeraita
degli Studi, Genoa, Italy
Professor A. Bechin, Institute of World Economics, Moscow, U.S.S.R.
Dr. James Washington Bell, American Economic Association, Evanston, Ill.
Mr. J. N. Bhagwati, Nuffield College, Oxford, U.K.
Professor I. Bowen, University of Western Australia, Nedlands, Western
Australia
Professor M. Bye, Institut de Science Economique Appliquee, Paris
Professor D. J. Delivanis, University of Thessaloniki, Athens, Greece
Professor L. Fauvel, Faculte de Droit, University of Paris, France
Dr. Romulo Ferrero, Lima, Peru
• Mr. K. Forcart, Social Sciences Division, UNESCO, Paris, France
Professor H. Giersch, University of Saarbriicken, Germany
Professor E. Gudin, Rio de Janeiro, Brazil
Professor G. Haberler, Harvard University, Cambridge, Mass., U.S.A.
Professor D. Hague, Duke University, Durham, N. Carolina, U.S.A.
Sir Roy Harrod, Christ Church, Oxford, U.K.
• Mr. R. Hellberg, United Nations, Geneva, Switzerland
Professor E. James, University of Paris, France
Professor H. G. Johnson, Dept. of Economics, University of Chicago,
U.S.A.
Professor W. A. Johr, St. Gallen, Switzerland
Professor V. Kaigl, Institute of Economics, Academy of Sciences, Prague,
Czechoslovakia
Professor C. P. Kindleberger, Massachusetts Institute of Technology,
Cambridge, Mass., U.S.A.
Professor H. Kitamura, Economic Commission for Asia and the Far East,
Bangkok, Thailand
Mr. A. Lamfalussy, Banque de Bruxelles, Brussels, Belgium
Mr. H. H. Liesner, Emmanuel College, Cambridge, U.K.
Professor E. Lipinski, Warsaw, Poland
Professor E. Lundberg, Stockholm, Sweden
Sir Donald MacDougall, Nuffield College, Oxford, U.K.
Professor A. Mahr, University of Vienna, Austria
* Observers
vii
List of Participants
Mr. A. Maizels, National Institute for Economic and Social Research,
London, U.K.
Dr. V. A. Marsan, Istituto per la Riconstruzione Industriale, Rome, Italy
Professor R. F. Mikesell, University of Oregon, U.S.A.
Professor T. Morgan, University of Wisconsin, U.S.A.
Dr. H. Myint, Rangoon University, Burma
Professor Ichiro Nakayama, Tokyo, Japan
Professor F. Neumark, Frankfurt-am-Main, Germany
Professor B. Ohlin, Stockholm School of Economics, Stockholm, Sweden
• Dr. Garda Olano, Buenos Aires, Argentine
Dr. I. G. Patel, International Monetary Fund, Washington 25, U.S.A.
Mr. Leo Rip, Belgrade, Yugoslavia
Professor E. A. G. Robinson, Cambridge University, U.K.
Dr. K. M. Savosnick, Manchester University, U.K.
Dr. V. P. Sergeyev, Moscow, U.S.S.R.
• Dr. G. Skorov, Chief, Division for International Development of Social
Sciences, UNESCO, Paris, France
Professor E. Sohmen, Frankfurt, Germany
• Dr. K. Szczerba-Likiernik, International Social Science Council, Paris
Professor Shigato Tsuru, University of Rochester, N.Y., U.S.A.
Professor J. WeiHer, University of Paris, France
• Observers
PROGRAMME COMMITTEE
Austin Robinson (President I.E.A.)
Roy Harrod (Chairman)
Fritz Neumark (Treasurer I.E.A.)
Maurice Bye Sune Carlson
Charles Kindleberger K. N. Raj
viii
ACKNOWLEDGEMENTS
THE International Economic Association wishes to thank all those
who did much to ensure the success of the Conference recorded in
this volume. Special gratitude is due to the management and staff
of the Grand Hotel, Brissago, Switzerland, where the Conference
was held in conditions admirably conducive to good-humoured but
vigorous discussion.
The Conference received financial support from UNESCO and
welcome assistance from officers of that organization. It was sup
ported also by funds available from the general grant to the Associa
tion made by the Ford Foundation. Without the support of these
two bodies it could not have been held.
It need scarcely be added that the success of a Conference rests
primarily on the quality of the papers and the discussion contributed
by its participants. To all those who contributed in that way both to
the Conference itself and to this volume the International Economic
Association expresses its sincere gratitude.
A2 ix
INTRODUCTION
BY R. F. HARROD
No excuse is needed for the choice of international trade and invest
ment as the subject for discussion at the Conference organized by
the International Economic Association, which met at Brissago,
Switzerland, on September 1-9, 1961. Forty-seven persons were
present, drawn from twenty-two countries.
Problems connected with international trade and investment are
coming into the forefront of consideration in relation to economic
policy making. Correct solutions could guide statesmen in their
decisions, not only about policies specifically concerned with external
relations, but also about matters seemingly related to the internal
conditions of each country only. It is becoming ever more apparent
how much may be gained if nations come together and see the
pattern of world development as a whole. Only in the light of this
will it be possible to see in correct perspective what ought to be
done by each nation separately. And this is not only looking at the
matter from the point of view of pure altruism ; the self-interest of
each country also requires that its policy should be appropriate in
relation to the wider setting. Gone is the time when it could be
considered sufficient for national economic policy makers to regard
their duties on the external side as bounded by the precept that
they must keep their balances of payment in good order. Import
policy, for instance, should be assessed, r.ot only by what a given
country needs for its own purposes, but in relation to balanced
growth in the world as a whole.
Even more important than the relevance of a given topic to
pressing practical problems is its relation to the progress of economic
science. For, if such progress is achieved, that can help the solution
of problems over an indefinite future. The Programme Committee
felt that the relation of dynamic theory to international trade theory
might be a key question. Such modest progress as dynamic theory
has so far made has been in the main confined to the analysis of
closed economies. Apart from a small number of brilliant journal
articles, the task of extending dynamic concepts into the field of
international trade theory has hardly been started. There are virgin
lands to be explored.
It was naturally not expected that, however much trouble authors
xi