Since the early 1950s, scholars from diverse regions and disciplines have analyzed the terms of trade of developing countries. The Latin American contribution to this discussion has been especially noteworthy. Raul Prebisch, a "pioneer" in proposing a secular decline in the terms of trade for developing countries, was an Argentine whose career included a long association with the United Nations and with the Economic Commission for Latin America (ECLA). Prebisch's thinking influenced an entire generation of economists from Latin America and elsewhere who were preoccupied by postwar economic concerns. Prebisch, along with Singer, relied upon the terms of trade to challenge the conventional notion that comparative advantage was a country's best guide to the allocation of resources and hence to the international division of labor. Based upon our analysis, however, there is little empirical evidence that deteriorating terms of trade hindered Latin American growth at precisely the time (1820s-1870s) when large international disparities in income began to emerge. Whatever the causes for Latin America's "falling behind" in the nineteenth century might be, a secular deterioration in its terms of trade does not appear to be one of them.
Salvucci, L. K., & Salvucci, R. J. (2000). Cuba and the Latin American terms of trade: Old theories, new evidence. Journal of Interdisciplinary History, 31, 199-222.
Journal of Interdisciplinary History