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Currency Devaluation and Resource Transfer from the South to the North

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This article examines the existence and the persistence of the North-South geographic categories and the North-South income gap in light of the political economy of currency devaluation as one largely underinvestigated thesis in the geography of development. Based on a broad overview of development geography, a cross-country analysis, and a case study, the article argues that currency devaluation contributes to resource transfer from the South to the North primarily through the devaluation of southern exports and the overvaluation of northern exports. It suggests that any reversal of this trend will likely require a serious protectionist policy to reduce the volatility of capital flows and exchange-rate movements.
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Keywords: Mauritania; North-South divide; currency devaluation; development geography; resource transfer

Document Type: Research Article

Publication date: 2003-06-01

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