As in Roemer (1982, chapter 1), this paper considers a simple international trade model and examines the existence and characterization of free trade equilibria involving the unequal exchange of labor (UE). The paper provides an almost complete characterization of the domain of economies in which free trade equilibria with incomplete specialization exist. Moreover, the necessary and sufficient conditions for free trade equilibrium to involve UE is identified. It suggests that the emergence of free trade equilibria with UE cannot be entailed by the competitive mechanism of markets and unequal distribution of wealth alone, but might be understood as an outcome of equilibrium selection on the basis of Nash bargaining between rich and poor nations.

In this paper, using the concept of w-distances, and we prove existence theorems for single-valued mappings and set-valued mappings in a complete metric space which generalize Takahashi, Wong, and Yao's theorems. Primary 47H10; secondary 37C25; 58J20 MSC:

This chapter discusses how international exploitation and unequal exchange emerge in the global economy by focussing on simple economic models with and without credit markets. Free trade of commodities among rich and poor countries results in a transfer of labour time between countries, allowing the citizens of some countries to consume more of the world’s social labour than they have contributed. Capital movements across borders together with strong restrictions on the movement of people result in net exporters of capital exploiting (or benefitting from unequal exchange at the expense of) net capital importers. Under perfect competition, mutual benefits from free trade in goods and capital can coexist alongside unequal flows of revenue and labour in the world economy. Market imperfections and the open use of coercion are not necessary for international exploitation to emerge. However, they may be central for it to persist over time.

This study constructs a model of a monopoly where investors are also actors, and shows that, in contrast to traditional models, this model admits the welfare improvement caused by monopoly. This study also reveals that if a huge income gap exists in the initial stage, then monopoly exacerbates the expansion of the income gap caused by market trades. Moreover, we show that this exacerbation occurs in general situations under some additional (but natural) assumptions.