Re: Imagining an Alternative Global Trade Architecture

["Geoff Edwards" <g.edwards@xxxxxxxxxxxxxxx>]

This is a readable and logical summary of the scene; thanks Tom for drawing it to our attention.

 

To complete the treatment, it is necessary to factor in two additional observations. The first is that in a world of internationally mobile capital, the theory of comparative advantage (which is based on the assumption that labour and capital are immobile across national borders) is comprehensively falsified. This observation is of course additional to the well-known problems with the core assumptions of marginal economics shared with comparative advantage. The consequences of this observation are that the mainstream theory of trade is hollow.

 

The second observation is that the world has passed an acceptable rate of mass energy production, as even the climate is now destabilised. Trade dependent upon transport cannot expand without limit in an ecologically limited globe. World oil production will peak within the next ten years if it has not already peaked. When awareness of this reality seeps in, either oil will be deemed too precious to use in carting staple goods across the oceans; or else there will be a scramble by the rich nations to dominate supplies while the rest of the world starves.

 

These observations all point in the one direction: that maximising self-sufficiency is a superior organising principle than maximising trade. The superiority of self-sufficiency as a strategy is supported by Chang's empirical evidence you cite.

 

Regards
 
 
Geoff Edwards
PhD Student
Griffith University
Brisbane, Australia

-----Original Message-----
From: pkt-owner@xxxxxxxxxxxxxxxx [mailto:pkt-owner@xxxxxxxxxxxxxxxx]On Behalf Of Thomas I. Palley
Sent: Wednesday, November 19, 2003 6:29 AM
To: Thomas I. Palley
Subject: Imagining an Alternative Global Trade Architecture

Dear Colleagues,

 

Please find attached a paper titled “After Cancun: Possibilities for a New North – South Grand bargain on Trade.”

 

The paper explores the possibility for an alternative world trade architecture in which Northern countries reform their agricultural policies in return for global labor and environmental standards.

 

With the existing trade agenda stalemated, there is now an opportunity to think outside the box.

 

Sincerely,