Against the Tide: An Intellectual History of Free Trade

Description

About two hundred years ago, largely as a result of Adam Smith's Wealth of Nations, free trade achieved an intellectual status unrivaled by any other doctrine in the field of economics. What accounts for the success of free trade against then prevailing mercantilist doctrines? And how well has free trade withstood various theoretical attacks that have challenged it since Adam Smith's time? In this readable intellectual history, Douglas Irwin explains how the idea of free trade has endured against the tide of the abundant criticisms that have been leveled against it from the ancient world and Adam Smith's day to the present. An accessible, nontechnical look at one of the most important concepts in the field of economics, Against the Tide will allow the reader to put the ever new guises of protectionist thinking into the context of the past and discover why the idea of free trade has so successfully prevailed over time. Irwin traces the origins of the free trade doctrine from premercantilist times up to Adam Smith and the classical economists. In lucid and careful terms he shows how Smith's compelling arguments in favor of free trade overthrew mercantilist views that domestic industries should be protected from import competition. Once a presumption about the economic benefits of free trade was established, various objections to free trade arose in the form of major arguments for protectionism, such as those relating to the terms of trade, infant industries, increasing returns, wage distortions, income distribution, unemployment, and strategic trade policy. Discussing the contentious historical controversies surrounding each of these arguments, Irwin reveals the serious analytical and practical weaknesses of each, and in the process shows why free trade remains among the most durable and robust propositions that economics has to offer for the conduct of economic policy. Dedication Contents List of Illustrations Acknowledgments Introduction Part One: Origins of the Free Trade Doctrine 1 Early Foreign Trade Doctrines 2 The English Mercantilist Literature 3 The Emergence of Free Trade Thought 4 Physiocracy and Moral Philosophy 5 Adam Smith’s Case for Free Trade 6 Free Trade in Classical Economics Part Two: Controversies about the Free Trade Doctrine 7 Torrens and the Terms of Trade Argument 8 Mill and the Infant Industry Argument 9 Graham and the Increasing Returns Argument 10 Manoïlescu and the Wage Differential Argument 11 The Australian Case for Protection 12 The Welfare Economics of Free Trade 13 Keynes and the Macroeconomics of Protection 14 Strategic Trade Policy Conclusion: The Past and Future of Free Trade References Index