ABSTRACT
the role of the industrial countries as the main generator of the export instability which afflicts underdeveloped countries has often been emphasized in the literature. Economists frequently recommend that the industrial nations smooth out such instability by maintaining stable growth at home and by providing assistance to underdeveloped countries. Since it is clear that all the advanced industrial countries wish to maintain stable growth for their own sakes, the first part of this seems a rather superfluous recommendation. However, it may not even be particularly relevant. It is by no means clear that fluctuations in the production of the industrial countries have been a major cause of fluctuations in the export earnings of underdeveloped countries. But there are other aspects of their economies which may exacerbate fluctuations in the exports of underdeveloped countries. The object of this chapter is to evaluate various ways in which existing policies of industrial countries may make it more difficult for underdeveloped countries to achieve stable export earnings and to consider what improvements could be made.
