Theories of International Trade and Economic Imperialism

This chapter introduces and reviews a long tradition of theories which highlight unequal trade relations between countries, contesting the Ricardian view of mutual gains. Focussing particularly on mercantilism, ideas of changing terms of trade after Prebisch and Singer, and theories of unequal exchange, the chapter assesses the utility of theories of trade inequality in the twenty-first century. It argues that trade, and trade inequalities, need to be understood in their social and historical context and as one important dimension of the broader construction, reconstruction, and contestation of social relations. Contemporary trade relations therefore need to be understood, in particular, alongside changing class relations within countries and in the context of the expansion of corporate investment, which among other things creates problems for the way trade and the putative gains from trade are measured. Relations of trade also need to be understood in the context of broader relations of international inequality, particularly relations of political power and of money and finance.