Debunking competition - Global ecologically unequal exchange explained by exploitation and control relations

Overview & Synopsis

According to mainstream economic theory, competition is the fundamental force that regulates production and exchange in the global economy. It is presumed that countries compete in international markets with mutually beneficial outcomes for all parties. However, this assumption is challenged by increasing socioeconomic inequalities across and within countries, as well as global environmental degradation. Among other critical theories, Ecologically Unequal Exchange argues that international trade triggers asymmetries in the distribution of benefits and costs between Core and Periphery regions of the global economic system. We combined Environmentally Extended Multi-Regional Input-Output analysis and Ecological Network analysis to empirically determine which type of ecological relation (competition, control, exploitation or mutualism) characterizes the interaction between countries in international trade. Our research revealed that exploitation and control relations are far more prevalent than competition or mutualism in the global economy. Although the Periphery and Semi-periphery exhibit higher environmental intensities, the responsibility for most environmental degradation can be attributed to a few Core countries that drive resources' extraction and appropriation. Consequently, the Core enhances its economic and environmental performance by exploiting and controlling the Semi-periphery and Periphery. Our findings demonstrate that green growth and dematerialization policies may be unable to achieve socially fair and environmentally sustainable societies at the global level if the structure of the global economy remains unchanged.