June Flanders’s 1964 thorough critical assessment of the Prebisch thesis
on protectionism and industrialization at the periphery is a classic of
its kind. However, it does not follow from Flanders’s evaluation that
Prebisch was a “poor economist”.  True enough, his (and Hans Singer’s)
hypothesis of falling terms of trade has been controversial and criticized
from both theoretical and empirical perspectives.  However, as pointed out
by Flanders 1964, the “heart” of the Prebisch case for protection was his
proposition that the periphery’s relative rate of economic growth is
constrained by the disparity between the income elasticities of its
imports from industrialized countries and of its exports of primary
commodities. Prebisch’s approach (based on a careful application of
Harrod’s foreign trade multiplier) has become the backbone of balance of
payments constrained growth models further developed and tested since the
1970s by Anthony Thirlwall and others (see my paper with Ricardo Solís
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2151264). Surely, the
validity of Prebisch’s “single, minimum model” is an empirical question,
as remarked by Flanders 1964. But that is true of any economic model.

    Citando M June Flanders <[log in to unmask]>:
>
> Dear All
>
>  
>
> I blush at sounding my own horn, but I feel obliged to comment at  
> this point. I disapprove of Raul Prebisch’s inclusion not because he  
> was a protectionist, but because he was a poor economist, however  
> effective he may have been in the Economic Commission for
>
> Latin America (ECLA), UNCTAD,  and other such organizations.  I made  
> that point in a paper published in /The//Economic Journal/ (after a  
> good deal of hesitation on the editor’s part) in 1964:“Prebisch on  
> Protectionism: An Evaluation,”/The Economic Journal/,  Volume LXXIV,  
> No. 2, June 1964. 
>
> The editor invited Prebisch to submit a reply, which was not  
> forthcoming.  My paper was included in four handbooks and  
> collections on development, and translated, without my knowledge,  
> into Spanish in Latin America.  More to the point, people I knew at  
> the time who were active and prominent in the development field  
> commented that they were astonished to learn that the economic  
> arguments in Prebisch’s writings were so thin and flawed.  I am not  
> aware that there was any counter argument to my paper, by anybody.
>
>  
>
>  
>
> Professor M June Flanders
>
> The Eitan Berglas School of Economics
>
> Tel Aviv University
>
> Tel Aviv  Israel  69978
>
>  
>
>  
>
> [log in to unmask]
>
>  
>
>

Mauro Boianovsky
    Department of Economics
    Universidade de Brasilia CP 4302
    Brasilia DF 70910-900
    Brazil
    Fax: 55 61 33402311
    Phone: 55 61 31076583