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RE: Productivity, Growth, and Trade: A Little Freedom Goes A Long Way

in #economics7 years ago

eh, the benefits of trade don't rely on labor hour pricing; i've actually never heard of that before. It's all about relative advantage, labor cost differentials being one such advantage, but there are plenty other factors in production...some real, others artificial like taxes and regulations.

Also, the concept of a social welfare safety net is separable from any trade argument. Trade makes societies wealthier, period. Not everyone within society benefits, though, as trade adds competition which of course means some people in some businesses get out competed. Whether that competition comes from your neighbor or someone living across national borders is irrelevant to the process.

There have always been arguments against competition; that was the entire justification for the destructive guild systems in feudal Europe.

It would be better for society to refrain from forcefully limiting competition and simply providing some safety net after the fact to those that lose out, rather than forcing most of society to lose out by stifling the entire process.

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