March 1, 2018

Free Trade Forever

Free trade is a net benefit. Exporters are more productive and pay higher wages on average. And imports are the whole point of trade (we can make the exports ourselves duh). Reducing barriers to imports increases competition, leading to lower real prices / higher real wages.

Even if the globalization of trade was a bad thing, nationalist trade barriers are a nonsensical solution. Some money spent on imports goes to domestic firms that sold the products. Some money spent on "made in the USA" products goes to foreign firms that produced intermediate inputs. Trade barriers decrease competition, and increase the cost of production and consumption, which harms the poor the most for the benefit of a minority of incumbent capital owners.


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