Exchange and Development

Exchange and Development

An Anatomy of Economic Transactions

Peter A. Cornelisse and Erik Thorbecke

This innovative and important book develops a new framework for analysing exchange that takes place within and outside markets over the course of development.

Chapter 4: Elements of Exchange

Peter A. Cornelisse and Erik Thorbecke

Subjects: development studies, development economics, economics and finance, development economics, institutional economics

Extract

OVERVIEW The primary aim of this chapter is to describe the fundamental elements of exchange items, actors and environment, which are the three pillars underlying the exchange-configuration approach. Depending on the transactions to be analyzed, the elements have to be subdivided or decomposed into more specific categories and subgroups. This chapter will indicate the major subgroups and components to be distinguished as well as those characteristics that appear to be the most powerful and discriminating determinants of the shape and content of transactions. The nature of the three elements and the major differences between them are taken up in Section 4.2, which also contains operationally useful taxonomies and sub-divisions for each of the three elements. The exchange elements are then discussed in more detail in the subsequent sections. Subsection 4.3.2 focuses on factors of production (a subgroup of the exchange element item exchanged), and describes explicitly the ways in which the most relevant properties of exchange elements impact on the formation, form and content of market transactions relating to credit, foreign exchange and land respectively. Space limitations prohibit similarly detailed descriptions for other transactions. But, throughout the chapter, brief indications are presented of the impact that certain dimensions of elements have on the make-up of ensuing transactions. Many aspects of elements of exchange needed to define an exchange configuration such as the incomes of the consumers and the number of actors on both sides of a transaction are easy to quantify. Other aspects of elements, however, cannot readily be expressed...

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