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Destructive Trade and Its Effects on the Global Economy


  • Jaroslav Vanek



This lecture was offered in honor of Professor Robert Mundell; a most fitting coincidence since the speaker was his classmate at MIT in 1955, exactly 55 years ago, and the topic emanated from our joint study with Professors Kindleberger and Samuelson at that time. The essence of the presentation can be summarized in its significant conclusions. The theory of comparative advantage as applied to real-world phenomena—and its practical free-trade recommendations—must be rejected or at least questioned, especially when it comes to trade between the advanced and the developing economies. The more realistic, even if less elegant mathematically, theory of Destructive Trade—explained in the lecture—should be a better guide in defining world trade solutions and leading us in the long run out of the present global crisis. Copyright International Atlantic Economic Society 2010

Suggested Citation

  • Jaroslav Vanek, 2010. "Destructive Trade and Its Effects on the Global Economy," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 38(3), pages 317-324, September.
  • Handle: RePEc:kap:atlecj:v:38:y:2010:i:3:p:317-324
    DOI: 10.1007/s11293-010-9239-x

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    References listed on IDEAS

    1. Slaughter, Matthew J., 2001. "International trade and labor-demand elasticities," Journal of International Economics, Elsevier, vol. 54(1), pages 27-56, June.
    2. Mary Amiti & Shang-Jin Wei, 2005. "Fear of service outsourcing: is it justified?," Economic Policy, CEPR;CES;MSH, vol. 20(42), pages 308-347, April.
    3. Kesselman, Jonathan R & Williamson, Samuel H & Berndt, Ernst R, 1977. "Tax Credits for Employment Rather Than Investment," American Economic Review, American Economic Association, vol. 67(3), pages 339-349, June.
    4. Haskel, Jonathan E, 2000. "Trade and Labor Approaches to Wage Inequality," Review of International Economics, Wiley Blackwell, vol. 8(3), pages 397-408, August.
    5. Paul, Catherine J Morrison & Siegel, Donald S, 2001. " The Impacts of Technology, Trade and Outsourcing on Employment and Labor Composition," Scandinavian Journal of Economics, Wiley Blackwell, vol. 103(2), pages 241-264, June.
    6. Ben Shippen, 1999. "Labor market effects of import competition: Theory and evidence from the textile and apparel industries," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 27(2), pages 193-200, June.
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