Commodity Shortages and Changes in World Trade

Abstract

The healthy expansion of trade relations experi enced throughout the postwar era has recently been inter rupted. During the 1973-74 economic boom, there were widespread shortages of commodities. As the world economy has plunged into a deep recession, most of the commodity shortages have disappeared. Looking ahead for the next 10 years or so, when the world economy returns to a path of normal growth, are we likely to see widespread chronic commodity shortages? An analysis of prospective market con ditions leads us to conclude: (1) that we are not on the threshold of an era of chronic and widespread commodity shortages; (2) that, indeed, the trade picture that emerges is not favorable for developing countries; (3) that the absence of global shortages in most primary commodities in the coming decade points up the soundness of interdependence through trade; and (4) that while trade has not so far bene fited all participants equitably—and this situation should be corrected in the future—trade should not be strained to the point of breakdown by treating it as the only means for cor recting all the inequities among nations.