Naciones Unidas

Raúl Prebisch and the challenges of development of the XXI century

Development and inequality

Identifying the vision of inequality in Prebisch’s work is no easy task for a number of reasons. On the one hand, his numerous contributions to Latin American development are integrated into a sweeping vision that encompasses the functioning of the economic system as a whole. Within this comprehensive overview, the specific approach to the issue of inequality seems to take shape and requires a detailed analysis in order to pinpoint it. As Prebisch himself admitted, his thinking on development went through successive phases and shifts over time, reflecting his role as a theoretical thinker but one who was firmly anchored in the economic reality of his time.  

References to inequality in studies carried out in the 1950s concern the differences in sectoral productivity levels associated with the concept of structural heterogeneity and fundamentally with inequality between countries. At this time, Prebisch responded to the general currents of thinking which were focused mainly on the problem of income distribution as a result of sectoral changes in the economy. His contribution in this regard lay in the emphasis he placed on the centre-periphery relationship and on the inequality that was generated and reproduced internationally by the different patterns of production specialization.  Inequality within Latin America was implicit in the concept of duality and structural heterogeneity. During this phase, attention was also paid to functional income distribution, which was in keeping with the Keynesian-type models of economic growth identified by Harrod and Domar, who considered the need for equilibrium between the different components of demand: consumption and investment, which are associated with earnings and wages. But Prebisch’s emphasis, unlike that of Keynes, was on balance-of-payments constraints, which is why, unless they were combined with structural adjustments, Keynesian policies in favour of expanding demand in times of trade balance crises only served to deepen external disequilibria.

Tetralogy of the equality - ECLAC


Antonio Prado: La economía política de la apropiación de los aumentos de productividad (2013 - 3:08)

Juan Pablo Jiménez - Política Fiscal: heterogeneidad y desafíos comunes en la región (2013 - 5:06)