Comments on: TWoN Book 4 Chapter 3 http://dreamcafe.com/words/2009/12/08/twon-book-4-chapter-3/ The Dream Café Weblog Wed, 08 Feb 2012 23:59:40 -0800 http://wordpress.org/?v=2.8.6 hourly 1 By: ghosttie sent a spelling edit. | gooseGrade http://dreamcafe.com/words/2009/12/08/twon-book-4-chapter-3/comment-page-1/#comment-7197 ghosttie sent a spelling edit. | gooseGrade Thu, 10 Dec 2009 21:13:21 +0000 http://dreamcafe.com/words/?p=818#comment-7197 [...] is no certain way to no whichEdit: there is no certain way to know whichStatus: PendingReport Abusehttp://dreamcafe.com/words/2009/12/08/twon-book-4-chapter-3/ [...] [...] is no certain way to no whichEdit: there is no certain way to know whichStatus: PendingReport Abusehttp://dreamcafe.com/words/2009/12/08/twon-book-4-chapter-3/ [...]

]]> By: Scott http://dreamcafe.com/words/2009/12/08/twon-book-4-chapter-3/comment-page-1/#comment-7168 Scott Wed, 09 Dec 2009 18:44:41 +0000 http://dreamcafe.com/words/?p=818#comment-7168 Free trade, like microeconomics in general, rests on relative value. You are always selling something you value less than its price to people who value it more than its price. The value of international trade is that you get a larger universe of potential people to exchange with, and a larger universe of goods to exchange. Ricardo went into this topic at greater length, and Krugman recently received a Nobel for a more sophisticated trade model under conditions of imperfect competition. Free trade yields: 1) greater potential scale for domestic goods, 2) cheaper, more plentiful goods of the sort we've been producing domestically, and 3) a greater variety of goods than we would have with borders closed to trade. There are good reasons to protect very small domestic industries during the incubation phase, but broad trade protectionism makes consumers in both nations worse off more than it makes producers in either country better off. While markets are not physically infinite, it's worth noting that since the late 18th century, for the first time in human history, we've experienced a growth rate substantially greater than the growth of population, due to improvements in production and distribution technologies. Free trade, like microeconomics in general, rests on relative value. You are always selling something you value less than its price to people who value it more than its price. The value of international trade is that you get a larger universe of potential people to exchange with, and a larger universe of goods to exchange. Ricardo went into this topic at greater length, and Krugman recently received a Nobel for a more sophisticated trade model under conditions of imperfect competition.

Free trade yields: 1) greater potential scale for domestic goods, 2) cheaper, more plentiful goods of the sort we’ve been producing domestically, and 3) a greater variety of goods than we would have with borders closed to trade.

There are good reasons to protect very small domestic industries during the incubation phase, but broad trade protectionism makes consumers in both nations worse off more than it makes producers in either country better off.

While markets are not physically infinite, it’s worth noting that since the late 18th century, for the first time in human history, we’ve experienced a growth rate substantially greater than the growth of population, due to improvements in production and distribution technologies.

]]> By: Howard Brazee http://dreamcafe.com/words/2009/12/08/twon-book-4-chapter-3/comment-page-1/#comment-7167 Howard Brazee Wed, 09 Dec 2009 15:38:00 +0000 http://dreamcafe.com/words/?p=818#comment-7167 Just to show I have read this, here's a typo: "He observes on page 372 that there is no certain way to no which of two countries is favored by the balance of trade;" Just to show I have read this, here’s a typo:

“He observes on page 372 that there is no certain way to no which of two countries is favored by the balance of trade;”

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