Open AccessFree Trade in Theory and Policy: Contemporary Challenges
Author(s) -
Daniel Nagel,
Sorin Burnete
Publication year - 2018
Publication title -
human and social studies
Language(s) - English
Resource type - Journals
eISSN - 2286-3265
pISSN - 2285-5920
DOI - 10.2478/hssr-2018-0012
Subject(s) - circumstantial evidence , free trade , comparative advantage , competitor analysis , international trade , economics , indigenous , trade barrier , commercial policy , law and economics , state (computer science) , international economics , political science , law , ecology , management , algorithm , computer science , biology
Free trade denotes a state of international commercial relations premised on governments’ restraint from using policy instruments meant to favor indigenous industries against foreign competitors. According to the conventional trade theory advocated by classical and neo-classical thinkers, free trade makes little economic sense failing nations’ tendency to specialize based on comparative advantage, a concept with high persuasive influence despite the elapsing of time. Even though the comparative advantage rule has seldom been questioned per se, the free trade concept has been fiercely disputed and not infrequently, bashed. Nations’ involvement in international trade often follows patterns that do not fit theoretical models but attempt to respond to circumstantial interests, most often the need to protect poorly competitive industries. In common parlance, free trade has had both proponents and enemies.