Estimating the surplus in the periphery: an application to Turkey

This note discusses how the economic surplus concept can be used to analyse the constraints the world system imposes on economic development. An estimation of the surplus for Turkey for 1980--96 utilises K–hler's unequal exchange analysis to measure the transfer of surplus abroad and the official minimum wage to calculate essential private consumption. The estimation yields the allocation of the surplus between non-essential consumption, investment and unrequited transfers abroad. The note assesses Lippit's argument that the main obstacle to development is the misuse of the surplus in the domestic economy and not transfers abroad. Copyright 2003, Oxford University Press.