Explain the various concepts of terms of trade. Critically examine the behavior of terms of trade as explained by Prebisch.
Introduction The concept of terms of trade (ToT) is essential in international economics, representing the rate at which one country’s goods are exchanged for another country’s goods. It helps assess a country’s trading strength and its welfare from international trade. Various forms of ToT exist, and many economists, including Raul Prebisch, have analyzed their implications, […]