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What Do Progressives Need to Know About Trade? Some observations on the competitiveness debate


  • Donald Richards


In a recent book entitled Pop Internationalism Paul Krugman takes to task several prominent commentators who in recent years have published works decrying the loss of competitive position of the United States in an increasingly global economy. In particular, Krugman critically considers and rejects several arguments that he considers both wrong and dangerous. Among these are (1) the United States has lost, or is in the process of losing, its position of global technological leadership; (2) material standards of living in the US are threatened by the country's excessively liberal trade policies as compared with its trade partners; (3) stagnant or declining wages in the US are the result of trade with low wage Third World countries; (4) the US is in need of a new model and a corresponding policy approach that recognizes the changing structure of new global economic forces. The debate over the validity of the above assertions has been largely conducted between adherents of mainstream interpretations of international economic theory and policy. For Krugman the controversies are mostly a matter of a proper understanding of that theory along with an appreciation of the relevant data. The purpose of this paper is to offer an interpretation of the debate from a progressive left perspective. My position is that Krugman's critique of his imagined opponents on most issues is largely overdone and that there is actually substantive agreement among and between these mainstream views on most matters of trade and trade policy. More importantly, however, these same views, including Krugman's, are bounded by assumptions that are not supportable from a progressive left perspective. The title of the paper is an ironic twist on a title of one of Krugman's chapters, 'What do undergrads need to know about trade?'

Suggested Citation

  • Donald Richards, 1999. "What Do Progressives Need to Know About Trade? Some observations on the competitiveness debate," International Review of Applied Economics, Taylor & Francis Journals, vol. 13(1), pages 125-141.
  • Handle: RePEc:taf:irapec:v:13:y:1999:i:1:p:125-141
    DOI: 10.1080/026921799101779

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    References listed on IDEAS

    1. Dolado, J J & Malo de Molina, J L & Zabalza, A, 1986. "Spanish Industrial Unemployment: Some Explanatory Factors," Economica, London School of Economics and Political Science, vol. 53(210(S)), pages 313-334, Supplemen.
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