Finally, there are the immense invisible benefits of import competition for U.S. economic dynamism (a rate of change and innovation in the market) and standard of living. “If we find ways to get more and less, it means more resources to expand opportunities elsewhere in the economy,” George Mason`s Russ Roberts recently noted. “This expansion is invisible…. But it`s very important. Whether this creative destruction comes from commerce or technology doesn`t matter: the result is not just cheaper things, but better (and previously unimaginable) things, better jobs, better businesses and a better life. And it can only happen if it allows consumers and their capital to seek more productive goals. Pitigala, N. (2005) What does regional trade in South Asia reveal about future trade integration? Some empirical evidence. World Bank Policy Research, discussion paper 3497. Trade has not only brought economic benefits, but has long been a pillar of national and global security. As Robert Kagan of the Brookings Institution said in a Washington Post statement in 2018, the multilateral trading system was born not from a desire for global economic growth or a strengthening of global consumers, but from the fear of a new world war.
And this system, with all its crises and launches, has quite well achieved this goal for more than seven decades. Since the end of World War II, Kagan wrote, the global trading system has helped to “avoid the slightest risk of economic competition spreading to geopolitical competition” – “one of the great historical anomalies” of our time. The World Trade Organization has created an impressive place of efficiency for the settlement of bilateral trade disputes and an important path – notably through the accession process and its many commitments – for developing countries, in order to implement painful domestic reforms such as the “price” of WTO membership, reforms that would otherwise have been too politically difficult. (Even China has implemented such reforms and its post-accession setback is much more a breach of WTO enforcement than of the accession obligations themselves.) While the WTO system is not perfect, it is still much better than the fragmentary system of power politics, insecurity and the real war that preceded it. Indeed, the recent return of the United States to this old system of bilateral agreements and unilateral implementation is already causing concern around the world, even for some of our closest allies, such as Japan and Britain. The Forageer Foods Co. is one of Australia`s leading producers of freeze-dried food. Thanks to the free trade agreement between Australia and North Asia… The moralization of trade does not stop at the water`s edge either: the reduction of trade barriers in the United States and American leadership in the creation of agreements and institutions like the WTO have brought immense benefits to the world`s poorest. As the World Bank noted in its report on the role of trade in the fight against poverty, “since 1990, developing countries` participation in trade has collapsed with an equally significant decrease in extreme poverty in the world,” and the number of people living in extreme poverty has collapsed. Trade has also helped to “increase the number and quality of employment in developing countries, stimulate economic growth and promote productivity gains.” The history of the global trading system and international trade agreements is characterized by shifts between bilateralism, regionalism and multilateralism.