INTERNATIONAL TRADE
BY
JOSEPH KEELER
International Trade
Economists have always viewed free international trade as a source of wealth and welfare gains. The voluntary exchange of commodities induces favorable patterns of specialization and, therefore, leads to an improvement in the international division of labor. Since each country is driven to utilize its comparative advantage and to produce what it can produce most efficiently, the global output is increased and gains from international trade accrue to all countries. This optimistic view of free international trade has been challenged both from inside the body of mainstream economic theory (e.g. the optimal-tariff and infant-industry arguments) and by outsiders like dependency theorists. It has survived these critiques, albeit with some qualifications. Knowing that there are some exceptions to the rule, most economists now accept the general validity of the free-international trade principle, at least as a good rule of......
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Approximate Word Count: 1295
Approximate Pages: 5 (260 words per double-spaced page) |