SUSTAINABLE TRADE RELATIONS IN A GLOBAL ECONOMY

This paper illustrates how experimentation with a system dynamics mode l may be used to determine the terms of trade for meeting long-term co ntentions for sustaining global economic relations and environment, It has two :parts, a review of empirical evidence that describes the tre nds in the volume and the nature of international trade over the past decade, and an exploratory analysis of their implications for the emer gent contentions for global development and environment. The first par t draws on secondary data and literature. The second part attempts to reinterpret in the global context an existing model the author develop ed originally to understand valuation and income distribution processe s in a dualist economic system within a developing country. The explor atory nature of the second part should be accented since the model it draws on was developed for a different purpose and the analysis of his paper only addresses its relevance to the global context without modi fying any component of the model structure; hence it has some limitati ons. The original model focused, however, on the determinants of value accrued to the parties contributing to the production process, which is relevant both to income distribution within a country and the trans fer of value and environmental costs through trade between countries, The experimental process adopted in the paper is seen to be of value f or designing global agreements committing concerned parties to complex roles. (C) 1998 John Wiley & Sons, Ltd.