The paper gives a brief description of the unequal exchange thesis put forward by Emmanuel and others to explain the growing gap between nations. For this purpose we use an algebraic formulation in place of the usual numerical one, thereby making clear the basic assumptions underlying the thesis. Then we critically examine the thesis first within the Marxian framework and then within the Neo-Ricardian framework. It is shown that unequal exchange is not inevitable under free trade and that it is neither a necessary nor a sufficient condition for a loss from trade, if any, in the sense of a fall in the steady-state consumption per head.