Courtesy Reuters

Planning International Trade

THE classical economists of the eighteenth and early nineteenth centuries rightly regarded international trade as the international form of the division of labor. Adam Smith, who began the "Wealth of Nations" with his famous chapter on the division of labor as the source of the increase of wealth in modern societies, went on explicitly to treat of international trade as simply the extension of the same principle to cover the whole world market. Just as within each country exchange would be beneficial between one area and another, because different areas have different natural or acquired suitabilities for the production of different types of goods, so international commerce would be profitable to importer and exporter alike because of corresponding differences in national aptitudes for the various branches of production. International trade, like internal trade, was, in the view of the classical economists, essentially a process which would benefit both parties to the transaction and enable the sum total of wealth produced over the world as a whole to be greatly increased.

Of course the classical economists combined with this view of the beneficial consequences of international commerce the strong opinion that it ought to be left utterly unplanned and uncontrolled. Intent chiefly on breaking down the barriers which had been put in the way of the free development of both internal production and exchange and international commerce under the mercantile system, they stood for the freedom of production and trade in both the national and the international sphere, trusting to the enlightened self-interest of the individual entrepreneur to serve, better than any planned system possibly could serve, the interests of mankind as a whole.

Their views, accepted by Great Britain as the basis of her free trade commercial policy, and echoed by later British economists, were never similarly received without question in other countries. List set up against the cosmopolitanism of Adam Smith's outlook his "national system" of political economy; and, while some continental economists, notably in France and Austria, went even

Loading, please wait...

Browse Related Articles on {{search_model.selectedTerm.name}}

{{indexVM.results.hits.total | number}} Articles Found

  • {{bucket.key_as_string}}

This site uses cookies to improve your user experience. Click here to learn more.

Continue