Imperialist appropriation in the world economy: Drain from the global South through unequal exchange, 1990–2015

TLDR

Unequal exchange theory posits that advanced economies grow by appropriating resources and labour from the global South through price differentials, but prior estimates have struggled to capture upstream embodied resources. The study uses environmental input‑output data and footprint analysis to quantify the physical scale of net appropriation from the South between 1990 and 2015. The authors convert embodied resource and labour appropriations into market values and also report the drain in global average prices for comparison. In 2015 the North appropriated 12 billion tons of raw materials, 822 million hectares of land, 21 exajoules of energy, and 188 million person‑years of labour, worth $10.8 trillion in Northern prices—enough to end extreme poverty 70 times over—and over 1990–2015 the total drain reached $242 trillion, a quarter of Northern GDP, exceeding the South’s aid receipts by a factor of 30 and underscoring unequal exchange as a major driver of global inequality and ecological breakdown.

Abstract

Unequal exchange theory posits that economic growth in the “advanced economies” of the global North relies on a large net appropriation of resources and labour from the global South, extracted through price differentials in international trade. Past attempts to estimate the scale and value of this drain have faced a number of conceptual and empirical limitations, and have been unable to capture the upstream resources and labour embodied in traded goods. Here we use environmental input-output data and footprint analysis to quantify the physical scale of net appropriation from the South in terms of embodied resources and labour over the period 1990 to 2015. We then represent the value of appropriated resources in terms of prevailing market prices. Our results show that in 2015 the North net appropriated from the South 12 billion tons of embodied raw material equivalents, 822 million hectares of embodied land, 21 exajoules of embodied energy, and 188 million person-years of embodied labour, worth $10.8 trillion in Northern prices – enough to end extreme poverty 70 times over. Over the whole period, drain from the South totalled $242 trillion (constant 2010 USD). This drain represents a significant windfall for the global North, equivalent to a quarter of Northern GDP. For comparison, we also report drain in global average prices. Using this method, we find that the South’s losses due to unequal exchange outstrip their total aid receipts over the period by a factor of 30. Our analysis confirms that unequal exchange is a significant driver of global inequality, uneven development, and ecological breakdown.