Haberler’s 1959 critique of Prebisch-Singer did not contradict the GATT report bearing his name

Evidence

Haberler delivered his verdict on the Prebisch-Singer thesis in 1959 during lectures he gave in Cairo to commemorate the fiftieth anniversary of the National Bank of Egypt, and his assessment relied heavily on numerous critiques that had already been made by others. Although he did not dismiss the Prebisch-Singer thesis as impossible, Haberler faulted the analysis as very weak in empirical support. Furthermore, he argued that even if there had been a decline in the terms of trade in the recent past, there was no reason to assume that it would continue in the future, and no justification for basing policy recommendations on that assumption (Toye and Toye 2004, 133–134). In fact, none of the criticisms that Haberler offered of the Prebisch-Singer thesis are inconsistent with the conclusions reached by the GATT-appointed commission one year earlier: The Haberler Report did document a decline in commodity prices relative to those of industrial goods over a several year period in the mid-1950s, but it did not endorse the thesis of a secular decline in the terms of trade for raw material exporters. Its major complaint was not with the qualitative nature of trade between the rich and poor countries, but rather with the quantity of trade, and specifically with the consequences of market barriers constructed by developed-country governments. In “quiet and guarded language,” the report’s authors conceded that there was some merit to the developing-country grievances against the existing trade regime (Michalopoulos 2000), but they maintained that these complaints could be resolved through improved market access, and therefore more trade. The Haberler Report thus offered little in the way of ammunition for the G-77 countries when they appealed to the Prebisch-Singer thesis in making the case for the NIEO fifteen years later. — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1760

Categorization

• DEEPTHINKING: The resolution of the apparent contradiction is subtle: the report documented short-run price decline but rejected secular decline, so Haberler’s position was internally consistent though easily misread as self-contradictory.
• XREF: Connects to later chapters’ theme of neoliberal economists redirecting development policy from redistribution/grievances toward market-access and trade expansion. — connects to: Haberler framed GATT as a watchdog protecting non-European outsiders — Quinn Slobodian, Globalists: The End of Empire and the…, 667; The Prebisch-Singer thesis dominated UN development economics but faced wide academic skepticism. — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 1756; The 1958 Haberler Report moved GATT toward expanding developing-country trade — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 1758 (+1 more)

Broader Connections

• Prebisch and Singer argued primary producers face deteriorating terms of trade #expands (0.90) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1276
• The 1958 Haberler Report moved GATT toward expanding developing-country trade #qualifies (0.85) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1758