But the poorest one-sixth of humanity endures four-fifths of the world's civil wars.The best predictors of conflict are low average incomes, low growth, and a high dependence on exports of primary products such as oil or diamonds.
Exports of primary products and services contain more domestic income (93 and 90%% of export value, respectively).
Second, while world trade recovered in the 1950s, the composition of trade shifted against Argentine comparative advantage: exports of manufactured goods grew consistently more than exports of primary products.
Since these figures are from 2009, the d i /x i indicator in exports of primary products and some natural resource-intensive manufactures may have been significantly influenced by the high price of these products at that time.
For LAC countries, 55.3 % of merchandise exports consist of primary products, which comprise agricultural raw materials (1.7 %), food (17.9 %), fuel (23.1 %), and ores and metals (12.6 %) (World Bank 2013).
One long-held belief was that the terms of trade tended to move against less-developed countries because their exports consisted chiefly of primary products (such as coffee or rubber) while their imports largely comprised manufactured and, consequently, more-expensive goods from developed countries.
Some countries are highly dependent upon the export of a limited number of primary products.
Furthermore, prices of manufactured goods produced in countries of the economic "core" (using Prebisch's terminology) are downwardly rigid, while prices of primary products, exported by periphery countries, are downwardly flexible, given the institutional framework of the labor market in wealthy or poor countries.
On average across 35 LAC countries, real GDP per capita is $6,007, 25.3 % of the rural population is located on less favored agricultural land, the poverty rate is 41.2%%, the share of primary products in total exports is 63.5, and 20.8 % of the workforce is in industry.
To test the possibility that booms and busts in primary products trade may impact, at least temporarily, an economy's overall development, the share of primary products in total merchandise exports was also added as an explanatory variable in different versions of the growth analysis.
