Re: Keeping focus after the WTO

[Brad De Long <delong@xxxxxxxxxxxxxxxxx>]

> I already rebuked Barkley for that one.  He is off the list now
> temporarily.  I cannot believe how worked up he got over free-trade.


Why not?

One of the principal facts of world economic history over the past
century has been *divergence*--that technology is invented in the
industrial core and by and large *stays* *there* rather than being
adapted to conditions elsewhere and implemented. Hence workers and
bosses in the industrial core today are richer than their
counterparts in 1850 by a factor of 10? 20? 30? or so, it depends how
you count.

By contrast, workers and bosses out on the periphery are only richer
in a material sense than their counterparts in 1850 by a factor of 5?
2? and in a bunch of cases not at all. (Of course, improvements in
public health that standard economic statistics do not measure very
well have had a powerful impact on human happiness: material standard
of living is not the be-all and end-all for this and for other
reasons.)

One view--a view that has evidence supporting it, but that I am not
sure is correct--is that our best chance for large-scale technology
transfer is free trade: more economic contact between center and
periphery means more technology transfer to the periphery. And the
bosses won't be able to appropriate *all* of the gains.

From this perspective, those who are opposed to free trade--whether
because they view high labor productivity in Hermosillo as a threat
rather than an opportunity, because they think the U.S. should use
its market power to shape environmental policy in India (rather than,
say, negotiating with India for the terms on which shrimp fishers
will use TED's, because they want Agra to stay picturesque, or other
reasons--are the Enemies of Utopia.

I actually thought that Barkley was somewhat restrained...

:-)


Brad DeLong