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Please be civil and avoid name-calling and ad hominem remarks. Your name. Your email. Friend's name. Friend's email. First Name. Last Name. Phone number. Here, it was widely agreed, as I have argued myself in these pages, that the pendulum has swung from one direction to the other in the span of the last 20 years or so. Thus, when Bhagwati and I proposed in the early s that technology, not international trade, was likely the chief culprit in explaining the widening gap between skilled and unskilled wages in the US, most in the economics profession either were inclined to agree with us or were persuaded by our argumentation.
But, today, in the wake of a series of recent research papers by economist David Autor of Massachusetts Institute of Technology, US, and co-authors which seems to suggest that the labour market impacts of trade liberalization in the US were deeper and longer-lasting than conventionally believed, many in the economics profession appear to believe that trade is a more important culprit in explaining inequality in the US, especially wage inequality, than we believed 20 years ago.
The danger is that the pendulum may swing back too far. Economists are right to point to the distributional impacts of trade liberalization, as I have done myself in this column, and politicians are right to worry about these impacts. But this is entirely consistent with supporting trade liberalization as being in the national economic interest. The crucial element that makes these two statements logically consistent is that trade liberalization brings aggregate economic gain even in the presence of distributional impacts.
It remains to be argued, therefore, that the losers must be compensated, which ensures that everyone gains, or, at any rate, that no one loses—the classic Pareto principle of economics. The new challenges are twofold. One comes from the demands for Fair Trade as a precondition for Free Trade; the other, from the concern that Free Trade, while efficient, immiserises the unskilled in the richer countries.
The Economic Journal was first published in with a view of promoting the advancement of economic knowledge. Today, The Economic Journal is among the foremost of the learned journals in economics. It is invaluable to anyone with an active interest in economic issues and has established a reputation for excellence. The Economic Journal is a general journal with papers that appeal to a broad and global readership and offer a speedy and fair review process for papers in all fields of economics.
Alan Winters , International Finance. He has had a profound influence on trade policy thinking among scholars and practitioners. Once again he brings his formidable analytical gifts to bear in these lectures. They should be read by everybody who wants to understand the case for trade and why it sometimes seems so difficult to make that case.
In this book he does two important things: he punctures all the standard false arguments for protection, and he uses the modern theory of commercial policy to suggest how a balanced approach to trade and social policy might look. And all of this comes in a compact, lively, and readable package. Now these gains are being threatened by 'Seattle-person,' the offspring of an alliance between forces of ignorance and special interests. Jagdish Bhagwati's courageous stand against this threat merits our admiration.
His rigorous yet lively restatement of the case for free trade should be required reading for all participants in the public debate on globalization. Dixit , Princeton University. In this splendid book, he encapsulates all major arguments in favor of free trade and debunks many arguments against it in a lucid and entertaining style.
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