Bonus Quotation of the Day…

by Don Boudreaux on September 12, 2017

in Trade

… is from the opening paragraph of Chapter III, section 5, of James Mill‘s 1821 Elements of Political Economy (original emphases):

The benefit which is derived from exchanging one commodity for another, arises, in all cases, from the commodity received, not from the commodity given.  When one country exchanges, in other words, when one country traffics with another, the whole of its advantage consists in the commodities imported.  It benefits by the importation, and by nothing else.

DBx: UPDATE: There is one modification to make to Mill’s statement: when producers – domestic and foreign – are better able to take advantage of economies of scale in production and distribution because of access to larger numbers of consumers, consumers – domestic and foreign – also gain in the form of greater output and lower prices of those goods and services.  That is, by allowing the prices of some domestically produced goods to fall, freer trade that enables domestic producers of those goods to take advantage of the economies of scale that enables production to take place at lower per-unit costs benefits domestic consumers in a way in addition to greater access to imports.


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