Prebisch

Raúl Prebisch (1901–1986) was an Argentine economist who played a central role in shaping development economics in Latin America. As executive secretary of the United Nations Economic Commission for Latin America and the Caribbean (CEPAL) from 1948 to 1963, he led a prolific program of regional research on growth, trade, and industrial policy.

Prebisch helped develop structuralist economics and the center-periphery framework that analyzed Latin America's dependence on primary commodity exports and manufactured imports from the richer industrialized countries. He argued that the terms of trade tended to deteriorate for periphery economies, constraining growth unless countries diversified production and pursued active industrialization. This gave rise to policy prescriptions such as import substitution, protective measures for infant industries, capital formation, and state-led development, as well as regional integration and planning to reduce external vulnerability.

The Prebisch-Singer hypothesis, a key component of his work, posits that the long-run exchange value of primary commodities declines relative to manufactured goods, contributing to slower growth in commodity exporters. Policy implications emphasized breaking dependence on unfavorable terms of trade through industrial development, diversified export baskets, and coordinated regional strategies.

Prebisch's ideas helped shape postwar development policy in Latin America and established CEPAL as a leading center for development theory. They remain influential and controversial, attracting critique from liberal and neoclassical economists who questioned the universality and timing of the terms-of-trade deterioration and the efficacy of protectionist industrial policy. Notable works include CEPAL's The Economic Development of Latin America and its Principal Problems (1950).