By Daniel Ikenson
Analysis of proposed US tariffs on Chinese tires
Global economic integration has enabled enterprises to flourish on scales unimaginable just a generation ago. The re-imposition of barriers would be a huge mistake and should be eschewed. Instead, trade and investment policy should be brought up to speed with 21st century commercial reality.
"Just Trade" explores how trade barriers raise the cost of goods and services, harming consumers and producers alike. It shows that voluntary exchange between individuals is inherently good because each and every trade directly enhances the welfare of all participants. With each exchange, the entrepreneurial process leads to more, better and cheaper products being produced and available. This leads to sustainable development, leading to continuous improvements in human welfare.
Free trade is a powerful force for improving the health of the world's poor. Falling barriers to global has seen new health knowledge and technologies, and wealth, spread to nearly all corners of the globe. As a result, life expectancies have risen worldwide. This new paper, written by Philip Stevens, Director of IPN's health programme, shows how 50 years of trade liberalisation has significantly improved the health of the world's people.
The same barriers that prevent poor countries from becoming wealthy also prevent the poor from accessing ICTs. Attempting to correct for the so-called ‘digital divide’ by subsidising the provision of ICTs is unlikely to be successful. The digital divide is actually part of a larger ‘dirigiste divide’ which results from the governments of poor countries imposing all manner of restrictions on entrepreneurial activity, from lack of respect for property rights to a failure to uphold the rule of law.
This report shows what happened when the Kenyan government allowed private companies the freedom to trade and to compete against the government-owned telecommunications company. Access to mobile telephony flourished. An extensive segment was dedicated to the issues raised in this report on Newsnight, the UK's flagship news programme.
Critics of globalization forget that free trade fosters prosperity and know almost nothing about its most important benefit—its tendency to prevent war. Quantitative studies have shown that trade fosters peace both directly, by reducing the risk of military conflict, and indirectly, by promoting prosperity and democracy.
Complicated multi-lateral agreements on trade through the World Trade Organisation look increasingly less likely, but trade facilitation reforms can be implemented unilaterally and, in some cases, are even more beneficial.
In recent years, debates on international trade policy have focused on the role of the World Trade Organization and the two big political and economic powers – the USA and the EU. In this book, the author, an expert in trade policy, argues that this focus must change. Large supra-national institutions have become bogged down and are no longer in a position to drive trade liberalisation. Also, the world’s fastest growing economies are those Asian economies that have embraced free trade, in many cases going beyond international requirements.
Trade barriers immediately exacerbated--and have unnecessarily prolonged--the global food crisis, according to Douglas Southgame, Professor of Agricultural Economics at Ohio State University (U.S.A.). In a new report, Feed the World, Professor Southgate highlights how 30 countries imposed export restrictions or outright bans on trade in food at the outset of price increases, which led to yet further price spikes globally. Now that food prices have eased off their 2008 highs, 28 of these original trade restrictions still remain in place, making food expensive for consumers and disincentivising production for farmers. Read the press release here.