« Bufoonery | Main | The War and Wildfires» Don Boudreaux
October 24, 2007
The Benefits of Trade
Don Boudreaux
My GMU Economics colleague (and founder of the indispensable Econ Journal Watch) Dan Klein here explains why economists left, right, and center strongly support free trade. Here's part of Dan's message:
Free international trade increases the extent of the market. International buyers and sellers thicken the market, and make the markets for specialized goods more competitive and reliable. That's what makes further specialization justified in the minds of entrepreneurs. They go forward with specialization, and they enhance productivity. They make things used by people the world over.
That's why we all gain from increases in the extent of the market. Large, thick, international markets invite the productivity investments, and the result is better stuff at lower prices for all of us.
Today, the extent of the market is vast. That's one reason why humanity is better off than in the past. People in China are part of a great chain of beings, a chain that works to make stuff for humanity. Humanity would be happier still if the market were free of protective duties and quotas.
Posted by Don Boudreaux in Economics, Trade | Permalink
TrackBack
TrackBack URL for this entry:
http://www.typepad.com/t/trackback/23120/22725236
Listed below are links to weblogs that reference The Benefits of Trade:
Comments
I've forwarded the Klein article quoted above to almost everyone that I know. Hope everyone else does likewise. See the link below for my take on the same article.
I LOVE this site ! Thanks for all you do, Cafe Hayek !
http://thewhitedsepulchre.blogspot.com/2007/10/where-right-left-and-center-agree-free.html
Posted by: Allen in fort Worth | Oct 25, 2007 10:32:55 PM
I recently posted a comment on my blog at www.zatavu.blogspot.com about tariffs and subsidies you might find interesting. It's a note on a short passage from the book "The MIddle Way" by Lou Marinoff
Posted by: Dr. Troy Camplin | Oct 26, 2007 3:11:57 PM
I listened to a lecture by Dr. Schmit which he had said, “No one will live long enough to make pizza from scratch.” This view of his is entirely true. Being a philosopher he said it perfectly. It isn’t considered making a pizza if you buy the flour, salt, ingredients, etc. He meant it to be said society does not grow their own wheat or yeast, for the most part. We rely on the people who grow it for us so we can buy it later to satisfy our needs. This is a demand by the people to have ingredients to make whatever it is they need. The producers satisfy their needs by growing it and putting it out on the market. His view is that no one will live long enough to make pizza from scratch. We all need to trade or buy our goods from one another to produce a certain need. Without trade we wouldn't survive.
To Don Boudreaux,
Do you believe our economy will ever get to the point where we wouldn't need to trade anymore? Where we can produce and sell everything on our owns without trading from anyone outside the US?
Posted by: lmclane | Feb 19, 2008 11:17:58 PM
I like that you are discussing the benefits of trade because I recently attended a lecture by Dr. David Schmidtz at the Mesa Community College; he talked about many interesting things I found it to be most on the effects of trade. One thing that got my mind going was how he said "no one will live long enough to make a pizza". As he explained himself he said you must grow your own harvest and anything you might need, and not just buy everything. This statement really made me wonder and open my eyes to how the world and trade system seems works. How would are world work without trade and services? Dr. Schmidtz also talked about Adam Smith and the invisible hand. Before this lecture I did not know much about Smith or what he developed. Dr. Schmidtz gave an example by stating individuals will always attempt to get the best deal for themselves, at least in their minds, creating the most reward for everyone. This concept makes sense to me, but I did some reading on Adam Smith and he felt so strongly about the invisible hand creating more utility for all participants, that he said that regulation would never be needed in a free market due to this invisible hand. What is your point or view on Adam Smith and the invisible had? Do you agree With Dr. David Schmidtz or have a different view? I would be very interested in reading what you think.
Posted by: Brandi | Feb 20, 2008 4:38:16 PM
The comments to this entry are closed.
