North/South, West and East: Industrial Restructuring in the World Economy
| DOI | 10.1177/002070208103600404 |
| Published date | 01 December 1981 |
| Date | 01 December 1981 |
| Author | S.W. Langdon |
| Subject Matter | Money and Markets |
S.W.
LANGDON
North/South,
West
and
East:
industrial restructuring
in
the world
economy
It
has
become
something
of
a
clich6
to
refer
to
a
world
economic
crisis. Yet clichds
have
a
way
of
reflecting
reality.
And
an
excel-
lent
case
can
be
made
that
the contemporary
international
econ-
omy
is
suffering
from
the
most
dislocating
combination
of
stagnant
aggregate
demand,
consequent
unemployment,
and
disruptive
trade
restructuring
since
the
Great
Depression
of
the
193os.
As
Fr6bel
puts
it,
the
world
has
experienced
'nothing
less
than
the
end
of
the
post-war
boom
(the
biggest
boom
in
the
history
of
capitalism).'"
What
has
this
process
of
change
meant
for
the
economic
pros-
pects
and
performance
of
the
less
developed
countries
(LDCS)
in
the
world
economy?
For
some,
rapid
growth
has
taken
place;
for
large
oil
producers
this
has
been
so
explosive
that
it
has
often
generated
considerable
social
dislocation;
for
a
small
number
of
newly
industrializing
countries
(NIcs)
export
manufacturing
has
expanded
rapidly.
For
most
other
LDCS,
though,
the
consequences
have
been
unambiguously
damaging.
They
have
been
squeezed
by
accelerating
oil
prices
and
by
stagnant
demand
for
their
pri-
Department
of
Economics
and
School
of
International
Affairs,
Carleton
Univer-
sity,
Ottawa,
Ontario.
This
article
relies
heavily
on
research
interviews
undertaken
with
the financial
support
of
the
Social
Sciences
and
Humanities
Research
Council
of
Canada,
Carleton
University,
and
the
Hungarian
Institute
for
Cultural
Relations.
These
interviews
were
conducted
in
the
Netherlands
in December
1q78,
August
1979,
September
198o,
and November
i98o,
in
Hungary
in
April
iq8i,
and in
Kenya
and
Gabon
in
November
ig8o.
i
F.
Fr6bel,
'The
current
development
of
the world
economy'
(Starnberg, Germany:
Max-Planck-Institut
zur
Erforschung
der
Lebensbedingungen
der
wissenschaft-
lich-technischen
Welt,
mimeo,
198o).
INDUSTRIAL
RESTRUCTURING
IN
THE
WORLD
ECONOMY
767
mary
product
exports;
their potential
for
export
manufacturing
gains
has
been
limited
by
competition
from
the
NICS
and
by
the
new
trade
protectionism
in
the
developed
countries.
Often
they have
so
indebted
themselves
to
cover
foreign
exchange
needs
that
they
have
become
little
more
than
wards
of
the
austerity-
minded
International
Monetary
Fund.
The
colonialism
that
was
blown
away
in
the
postwar
years
has
been
reborn
in
a
new
form.
This
is
not
the
vision
that
was
articulated
in
the
early
1970s.
A
New
International
Economic
Order
(NIEO)
was
envisaged
at
the
United
Nations
and
elsewhere -
aimed
at
establishing
a
fair
place
for
the
LDCS
in
the
world economy.
Eastern
and
Western
Europe,
in
particular,
stressed
the
need
to
redress
past
relationships
with
the
poorer
LDCS
-
the
former
in
their
strong
support
for
the
NIEO,
the
latter
through
the
Lom6
Convention
signed
with
most Afri-
can
and
Caribbean
countries.
This
vision
aimed,
inter
alia, at
a
restructuring
of
industrial
production
between
Europe
and
the
poorer
LDCS:
while
traditional
labour-intensive
manufacturing
was
phased
out
in
Europe,
technology would
be
transferred
to
the
poorer
LDCS
and
new
manufacturing
export
opportunities
opened
up
for
them
to
accelerate
their
growth
and
foreign exchange
earn-
ings.
This
article
analyses
what
happened
to
that
vision
as
the
world
economic
crisis
emerged
in
the
197os.
The
focus
is
on
three
vi-
gnettes,
reflecting
the
forces
at
work
in
two
of
the
major
indus-
tries
(textiles
and
wood
products)
which
analysts
expected
would
be
central
examples
of
such
industrial
restructuring.
Two
Euro-
pean
countries
are
selected
as
having
been
in
the
forefront
of
re-
structuring
efforts
in
these
industries
-
the
Netherlands
and
Hungary.
An African
perspective
completes
the
threefold
view.
Overall, the
analysis
shows
major
changes
to
have
taken
place
in
European
industrial production.
But,
despite
some
early
prom-
ise,
the
NIEO vision
has
certainly
not
been
achieved for
Europe's
African
trading
partners.
Rather
than
bringing
industrial
trans-
formation,
the
recent developments
in
the
world
economy
have
reinforced
the
traditional
role
of
most
LDCS
as
raw
material
ex-
porters
-
in
a
harsher
than
ever
international
environment.
In
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