Free Trade versus Protectionism: A Source Book of Essays and Readings

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Free Trade Versus Protectionism: A Source Book of Essays and Readings by Johannes Overbeek Edward Elgar - 1999 - 656 pages - $120.00

This is a book that operates on several levels and succeeds, to a greater or lesser degree, on all of them. Centrally, it is a history of economic thought in the form of extracts and short essays by the prominent advocates of free trade and protectionism, extending from mercantilist times to the present. Thus the reader is treated to a roughly chronological and fairly complete view of the development of economic thought and understanding of international trade and finance over more than two centuries, as well as the vital points in the free trade/protectionist debate.

Overbeek, professor of economics at the University of the Virgin Islands, divides the book into historical periods and for each one presents writings by the most prominent writers on both sides of the issue. He gives a short history of the periods regarding international trade and the public debate over the issue, and discusses how government policies were affected. He also provides a biography of each author and a summary of his arguments.

In his choice of material, I give Overbeek an A-plus. The most important writers are included, from Thomas Mun through Alexander Hamilton, Friedrich List, Mussolini, John Maynard Keynes, and Robert Reich on the protectionist side, and from David Hume and Adam Smith through John Stuart Mill, Ludwig von Mises, Gottfried Haberler, Melvyn Krauss, and Paul Krugman on the free trade side. Moreover, the extracts Overbeek has selected are all readable by anyone with even a rudimentary familiarity with economics. Abstruse mathematics is thankfully absent. My only criticism is that some of the readings are longer than necessary to make the author's argument, while others seem too short. In an apparent attempt to shorten the book to its still-daunting 656 pages, the writings of some key economists (Henry Hazlitt and Milton Friedman chief among them) have been left out in favor of summaries by Overbeek.

The book's virtue is that it clearly presents the arguments of both sides on the free trade debate. One cannot read both with any objectivity without seeing that the free traders have by far the stronger arguments. Interestingly, the reader observes that the brilliant breakthroughs occurred early on and that the principles established have never been overthrown. Particularly crucial are Ricardo's demonstration of the principle of comparative advantage and David Hume's demonstration of how monetary flows through international payments imbalances alter exports and imports to bring equilibrium to those balances and generate a natural distribution of specie. …