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Is free trade generally beneficial for a country?

Adam Smith is the founder of the concept of free trade, in his book "The Wealth of Nations" published in 1776. He came up with theoretical arguments showing that governmental barriers to trade such as tariffs and subsidies are ultimately not in the best interests of either side in a trade agreement. Karl Marx, the founder of communism, vigorously disagreed.

Implications to Other Questions

Is capitalism good?
Is free trade generally beneficial for a country?

Experts and Influencers

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Agree
Experts In Economics


Adam Smith    Founder of Modern Economics
Agree
By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain. ... By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good.
01 Jan 1776    Source


The Economist    Politics and Business Magazine
Agree
[The Economist was] founded in 1843 to support the cause of free trade.
01 Jan 1843    Source


Milton Friedman    Iconic Economist of 20th Century
Agree
Ever since Adam Smith there has been virtual unanimity among economists, whatever their ideological position on other issues, that international free trade is in the best interests of trading countries and of the world. ... [The] voice [of the consumer] is drowned out in the cacophony of the "interested sophistry of merchants and manufacturers" and their employees. The result is a serious distortion of the issue. ... "Protection" really means exploiting the consumer.
01 Jan 1980    Source


Robin Hanson    Economics Professor
Agree
We want a system where stuff is produced by the lowest cost suppliers and goes to the buyers who value it the most. If some supplier offers to sell stuff to folks at a lower price, well then we want folks to switch to buying from that supplier. ... This logic applies just as well to distant nations as it does to a convenience store down the street. Don't be fooled into treating [foreigners] differently because you were built to fear foreigners.
27 Sep 2010    Source


Experts In Politics


Ron Paul    U.S. Politician, Libertarian
Agree
Free trade is not a zero-sum game where some countries benefit and others inevitably suffer. On the contrary, true free trade by definition benefits both parties. Free trade is the process of free people engaging in market activity without government interference such as tariffs or managed-trade agreements. In a true free market, individuals and companies do business voluntarily, which means they believe they will be better off as a result of a transaction.
12 Feb 2001    Source


Barack Obama    United States President
Agree
Globalization is not someone's political agenda. It is a technological revolution that is fundamentally changing the world's economy, producing winners and losers along the way. The question is not whether we can stop it, but how we respond to it. It's not whether we should protect our workers from competition, but what we can do to fully enable them to compete against workers all over the world.
30 Jun 2005    Source


Hillary Clinton    US Secretary of State 2009-, Democrat
Agree
This is a sad day for supporters of free and fair rules-based trade. Our relationship with our Central American neighbors is a critical one. The right CAFTA deal would strengthen ties between the U.S. and these nations. I urge the Administration to reopen the CAFTA negotiations and re-establish the broad, bipartisan coalition for trade.
30 Jun 2005    Source


John McCain    U.S. Senator, Republican
Agree
Every time the United States has become projectionist [...] we could pay at a very heavy price. The Smoot-Hawley Tariff Acts in the 1930s were direct contributors to World War II. It sounds like a lot of fun to bash Chinese and others, but free trade has been the engine of our economy in the last half of this year; it will continue to be. ... Free trade should be the continuing principle that guides this nation's economy.
09 Oct 2007    Source


Kevin Rudd    Australian Prime Minister, 2007-2010
Agree
...what we have agreed -- again, as strong, long-term supporters of free trade around the world as one of the best drivers of global economic growth -- is to work very closely together in the months ahead to try and get a good, positive outcome for Doha -- good for our economy, good for the American economy, good for the global economy.
29 Mar 2008    Source


Malcolm Turnbull    Leader of Australian Liberal Party
Agree
Free trade in goods, services and capital has improved our standards of living. It has provided competition to drive innovation and productivity. It has increased real wages. Free trade has given more choice to Australians, more freedom to Australians and more job opportunities to Australians. And allowing financial capital to flow freely across borders is just free trade by another name.
15 Aug 2008    Source


Experts In Philosophy


Ayn Rand    Philosopher, Novelist
Agree
The essence of capitalism’s foreign policy is free trade—i.e., the abolition of trade barriers, of protective tariffs, of special privileges—the opening of the world’s trade routes to free international exchange and competition among the private citizens of all countries dealing directly with one another.
15 Jul 1986    Source


Encyclopedia


Conservapedia    Christian Encyclopedia
Agree
Since one nation has little control over another nation, without some sort of agreement between two nations, free trade might harm a particular group of people in one nation, such as laborers or consumers. However, the overall welfare of each country increases with free trade.
19 Aug 2009    Source


Disagree
Experts In Politics


Karl Marx    Father of Communism
Disagree
All the destructive phenomena which unlimited competition gives rise to within one country are reproduced in more gigantic proportions on the world market.
09 Jan 1848    Source


Ralph Nader    Politician, Consumer Activist
Disagree
Someday the pollyanna belief that the U.S. economy always replaces the jobs it loses overseas with new jobs here, as we keep racing ahead of other countries with modern technology and new or redundant services, may run into a contrary riptide that no set of spurious statistics can obscure.
17 Jul 2003    Source


Experts In Philosophy


Noam Chomsky    Linguistics & Philosophy Professor
Disagree
I don't understand how people can talk about "free trade" with a straight face. ... There is so much deception in the way the issues are formulated that it's impossible to proceed, without unraveling an intricate web of doctrinal mythology. ...talk of capital conceals [that] we are speaking of owners of capital, who are vastly unequal in power, naturally. In the real world, free movement of capital entails radical restriction of democracy, for obvious reasons that have long been well understood.
01 Jan 2006    Source


Experts In Entertainment


Peter Joseph    Movie Producer
Disagree
In turn, free market capitalism in the form of free trade, uses debt to imprison the world and manipulate countries into subservience to a handful of large business and political powers. Apart from these obvious amoralities, the system itself is based on competition, which immediately destroys the possibility of large scale collaborations for the common good. Hence paralyzing any attempt at true global sustainability.
02 Oct 2008    Source



Comments

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0 Points      Milo      12 Nov 2014      Stance on Question: Disagree
Free trade is not always voluntary in reality. I mean in the case of IMF pressure on regulated countries, this will eliminate gains from trade somehow

Another thing that free trade fails to explain is there is no learning effects so called Learning-by-doing. This can improve efficiency and lessen the dead weight loss.


1 Point      Nashhinton      20 Nov 2011      Stance on Question: Agree
Free trade is beneficial for the cooperation and foreign affairs between nations. It also increases the revenue and welfare of a nation. I'm a strong opponent of protectionism.


1 Point      blacktrance      10 Feb 2011      Stance on Question: Agree
Free trade allows countries to specialize and produce more. It's a great thing.


1 Point      the27th      09 May 2010      Stance on Question: Agree
Yes. Wealth. Cultural diffusion. Major driver of development.


2 Points      JGWeissman      27 Mar 2010      Stance on Question: Mostly Agree
Removing barriers to Pareto improvements is generally a good thing, though one should acknowledge the issues that giving people more opportunities to make unwise decisions is not really helping them (though it is dangerous to presume you are more wise than them about what decisions they should make), of transition costs in adjusting to changing relative advantages, and that uneven "free trade", where capital faces fewer legal barriers to changing countries than labor, can create an imbalance of power.


-2 Points      Ascendaeus      16 Mar 2010      Stance on Question: Disagree
It would be "Generally Beneficial" For both nations in the agreement to share they're resources for reasonable Compensation. But if one of the states involved held it's own citizen's up with a higher respect and dignity (Say one Countries citizens operate out of Emancipation and the other's doesn't) then the other nation Should Be Expected to emancipate it's fucking people before trade agreements are decided upon.... Or Say, if one Country's Citizens Live at a much Higher Standard of Living than The other Trading Country, (US AND CHINA) Than the Dominant Nation is operating out of a differential advantage, and to protect it's citizens from shoddy goods, it's producers from Outlandish Foreign Corporate Competition, The Dominant Nation Would Have to gauge duties in order to maintain the Profitability of It's Laborers, Companies and Corporations. If One Nation is particularly More Free, Stable, Safe, or has more opportunities, Then that Nation is at a Serious Social, Economic, Political and Moral Advantage. An Advantage in which The Lesser Nation Should Adhere too the Basic Freedom Principles Accepted by the Moral Fucking High Ground That The U.s. Stands on in Relation To Mexico, China, And all other Very impoverished Industrialized Nations. If We Want Cheap Plates From China, then China will Have to Stop Harvesting Organs From the Citizens it works to death, and if we want Cheap Tequila From Mexico First we'll Have Help them With Their Kidnapping Epidemic and Their 20 Million Homeless