Talk:Free trade

Conflicts in Article

For example, the section here has two subseciton,s advantages and disadvantages of tariffs. These two sections seem to contradict each other. From advantages: "In this case, the higher price would not cause domestic production to increase from QS1 to QS2, since it has already been assumed in our example that Japan produces the same amount of widgets for price Ptariff as the world economy does for price Pworld." The from disadvantages: "The higher price causes domestic production to increase from QS1 to QS2 and causes domestic consumption to decline from QC1 to QC2." Since both sections are directly referring to the chart at right, this is very confusing. — Preceding unsigned comment added by 66.71.29.40 (talk) 18:21, 28 August 2011 (UTC)

Free Trade or Trader Freedom?

Free trade is an ideology propagated by traders justifying trader freedom.Dr.P.Madhu (talk) 01:32, 22 August 2010 (UTC)

Within the ideology of free-trade alias trader freedom, the trader freedom is the foremost 'freedom' to be imposed on the world. Dr.P.Madhu (talk) 01:36, 22 August 2010 (UTC)

What are you talking about? Why should a liberty - the ability of consenting adults to make commercial agreements between each other - be an imposition? bobrayner (talk) 01:48, 22 August 2010 (UTC)

What he's getting at is that there is a group who has the ability to produce goods and/or trade them across international distances: traders. Free trade is directly beneficial to the traders and allows them to both maximize profits and avoid liabilities. Everyone else who does not have the means to be a trader benefits a) only tangential by having a wider or less expensive array of goods available or b) not at all, as the traders use their profit-maximizing/liability-limiting abilities to exploit them or their country. For the second group of people, free trade can be viewed is an imposition forced upon them which makes them poorer by allowing a larger number of entities to exploit them most efficiently. When you ask how a libierty could possibly be an imposition, you're looking from the perspective of a traders, not from the perspective of those who become exploited. Nailedtooth (talk) 15:48, 22 August 2010 (UTC)

You seem to focus on the availability of goods to these "non-traders", which rather overlooks other things facilitated by trade, such as services, technology, and the availability of jobs. Free trade doesn't just give me interesting cheap groveries, it also enables my employer to sell my skills where they're most needed, which further benefits my pocket. The picture of traders versus nontraders is an over simplification - or a false dichotomy - too.

But even if there are people unable to participate in trade - could you identify some people who are unable to buy or sell goods or services? - how are they "exploited" by others who do trade? This must be some new meaning of the word "exploitation" of which I was previously unaware.bobrayner (talk) 16:39, 22 August 2010 (UTC)

You've missed the point. The benefits to those who are not traders are only tangential; if you cannot engage in international trade yourself, your benefits are only a result of disproportionately larger benefits to those who can trade internationally (in your example, your employer). This, even though you benefit, is exploitative since you do not receive a proportional share of your effort. In other places, the mobility of production has allowed those who can trade internationally to engage in blatantly exploitative practices and/or escape liability for the results of those practices.

For all the good that free trades does it does have drawbacks. For those people whom the drawbacks hurt free trade is an unwelcome imposition that directly harms them and which is imposed upon them against thier will. That is what Madhu was saying. Nailedtooth (talk) 19:43, 22 August 2010 (UTC)

Is free trade more than trader freedom- more discussions should be there. Dr.P.Madhu (talk) 01:25, 30 September 2010 (UTC)

This article needs a lot of work

Larrytheordinarydragon (talk) 11:28, 10 November 2010 (UTC)

I currently see tons of problems here with bad writing, POV material, poor sourcing, etc. This is an important article and I think it deserves more attention from the community,Larrytheordinarydragon (talk) 11:22, 10 November 2010 (UTC)

Dispute tag on "trade diversion"

Why the dispute tag? Is there a source that says otherwise? bobrayner (talk) 18:15, 3 January 2011 (UTC)

I put the dispute section because the paragraph is based on the assumption that "free trade benefits society". I checked the link to which this statement is made and nowhere in the "mainstream economics" wiki page does it say this. Demosfoni (talk) 05:17, 4 January 2011 (UTC)

I think it's definitely the mainstream economics consensus that free trade benefits society, at least on a macro level (and that's mentioned and referenced at other parts within the free trade article). However, that wasn't the point of the paragraph as I saw it, the point being to explain the trade diversion effects of some free trade agreements. So, how about we amend the paragraph to merely state:

"According to mainstream economic theory, global free trade is a net benefit to society, but the selective application of free trade agreements to some countries and tariffs on others can sometimes lead to economic inefficiency through the process of trade diversion. It is economically efficient for a good to be produced by the country which is the lowest cost producer, but this..."

Would this meet everyone's approval?--TurquoiseThreads (talk) 05:35, 4 January 2011 (UTC)

Looks good. I would only ask that we omit the "sometimes" too. "Can" is already conditional, we don't need a second conditional. :-) bobrayner (talk) 10:20, 4 January 2011 (UTC)

Having sound knowledge about this matter, I agree with the proposed amendment, and will go ahead and make the change. Ratibgreat (talk) 12:31, 6 May 2011 (UTC)

Deletion of the views/research of Sonali Deraniyagala and Ben Fine

I've gone ahead and done this, but I can see it being contentious, so thought I would outline my thinking here. The section used to read:

"In an assessment of the literature on the theory and empirical research relating to the benefits of free trade, Sonali Deraniyagala and Ben Fine found that much of the work was flawed, and concluded that the extent to which free trade benefits economic development is unknown. Theoretical arguments are largely dependent upon specific empirical assumptions which may or may not hold true. In the empirical literature, many studies suggest the relationship is ambiguous, and the data and econometrics underlying a set of empirical papers showing positive results have been critiqued. The best of these papers use a simplified model, and the worst involve the regression of an index of economic performance on an index of openness to trade, with a mix of these two approaches common. In some cases, Deraniyagala and Fine claim, these indexes of openness actually reflect trade volume rather than policy orientation. They also observe that it is difficult to disentangle the effects of reverse causality and numerous exogenous variables."

My thinking was firstly that it was a view of dissenting economists to the mainstream, and given it was in the 'views of economists' section, it made sense to include the minority view as well. However, for several reasons, I don't think this particular paragraph is the best way to do so. Firstly, the reference given is to a book, not a peer-reviewed article. Given that it claims most econometrics on this issue of being wrong or misleading, I'd suggest a journal article, or at least views given by a more well-known economist, might be more appropriate. Secondly, the section at present does not include the individual research of any one economist. This makes sense, as if we were to just allow it to become a collection of different studies, it would become clunky and confusing to the casual reader. Far better to speak in broad terms about the views of broad sections of the profession, rather than one particular study. And thirdly, I'm a little suspicious of the fact that the first thing mentioned could be leveled at any economic modelling, or indeed any modelling at all (find me a model that doesn't use 'specific empirical assumptions'). Some of the other objections to current empirical research seem more reasonable (just - I mean, of course modelling is difficult, that's not really a criticism of it), but the way the section is written doesn't really do them justice. In my view, we need to find a reputable peer-reviewed source outlining the reasons 7% or whatever percent it was of economists don't believe free trade raises living standards, and not make poorly-backed claims about two economists 'finding' that the work of most other economists is flawed. --TurquoiseThreads (talk) 13:13, 4 January 2011 (UTC)