Identifying ecologically unequal exchange in the world-system: implications for development

This chapter presents the theory of ecologically unequal exchange (EUE). The theory explains asymmetric transfers of non-monetary, biophysical resources and environmental harms between different countries or regions. The chapter provides a cursory review of the literature on methods for empirically identifying such asymmetries and testing hypotheses derived from the theory. To identify EUE requires that other metrics than money are used to measure objective biophysical phenomena. In mainstream economics, such a physical concept of unequal exchange suggests an oxymoron, as market exchange assessed in monetary terms is equal by definition. However, to describe market exchange in terms of the flows of physical resources is not to suggest that such resources should be considered measures of value. EUE theory rejects approaches that posit the existence of objective values that are underpaid on the market, or propose that ecological degradation can be conceptualised using a monetary metric. In the most general sense, EUE reflects the displacement of entropy from economic core areas onto their peripheries. Among the specific metrics and methodologies mentioned are measures of embodied land, materials, energy, labour, water, biodiversity loss, pollution, and greenhouse gas emissions.