Prebisch–Singer thesis
Okay, so the Prebisch-Singer thesis is all about how developing countries may have a tough time getting ahead when it comes to trading with other countries.
Imagine you have some toys that you really like, and your friend wants to trade with you. They offer you some of their toys in exchange. Now, let's say you have some really cool and unique toys that are super popular and everyone wants to play with. Your friend doesn't have anything quite like your toys, but they offer you some common toys that lots of people have.
Well, if you agree to trade, you might think you're getting a good deal because you're getting more toys in total. But the problem is, everyone else already has the common toys your friend is offering, while your unique toys are still really special. So, in a way, your toys are more valuable and your friend is getting a better deal out of this trade.
This is similar to what happens with developing countries when they try to trade with wealthier, developed countries. The developing countries might have resources or products that are really unique and valuable, but often they end up trading them for things that are more common and less valuable. As a result, they can have a hard time advancing and improving their economies.
Does that make sense?
Imagine you have some toys that you really like, and your friend wants to trade with you. They offer you some of their toys in exchange. Now, let's say you have some really cool and unique toys that are super popular and everyone wants to play with. Your friend doesn't have anything quite like your toys, but they offer you some common toys that lots of people have.
Well, if you agree to trade, you might think you're getting a good deal because you're getting more toys in total. But the problem is, everyone else already has the common toys your friend is offering, while your unique toys are still really special. So, in a way, your toys are more valuable and your friend is getting a better deal out of this trade.
This is similar to what happens with developing countries when they try to trade with wealthier, developed countries. The developing countries might have resources or products that are really unique and valuable, but often they end up trading them for things that are more common and less valuable. As a result, they can have a hard time advancing and improving their economies.
Does that make sense?