The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Terms of Trade

  • Ronald Findlay
Reference work entry


This article describes the various approaches that have been made to the ‘terms of trade’, the question of determining and measuring the rate at which countries that engage in international trade divide the benefits between them. It traces the evolution of the relevant ideas, beginning with the pioneering contributions of David Ricardo, John Stuart Mill and Alfred Marshall.


Balance of trade Barter Commodity terms of trade Comparative advantage Double factoral terms of trade Gains from trade Gross barter terms of trade Immiserizing growth Income terms of trade Index numbers International trade theory Marshall, A. Marshall–Lerner condition Mill, J. S. North–South economic relations Offer curve Optimal tariffs Prebisch, R. Reciprocal supply and demand Ricado, D. Shadow pricing Singer, H. Single factoral terms of trade Stationary state Terms of trade Transfer problem 

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© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Ronald Findlay
    • 1
  1. 1.