- Cafe Hayek - https://cafehayek.com -

How Much Is a Dollar’s Worth of Exports Worth?

Tweet [1]

Here’s a letter to WTOP Radio:

During yesterday’s 9am hour, your news anchors interviewed someone (from Politico, if I recall correctly) who praised Pres. Obama for pushing “a pro-export agenda.”  The interviewee went on to pronounce that the experience of Asian countries “proves that exporting is a strong source of economic growth.”

Bull.

Growth occurs whenever the quantity and quality of valuable outputs increase and consumers are free to bid for these outputs.  A dollar’s worth of output sold abroad yields neither its producer nor the nation as a whole any premium over a dollar’s worth of the same output sold domestically.

Or as the economist Deirdre McCloskey correctly and cleverly notes: if borders are an especially powerful engine of growth, we’d get more growth simply by Uncle Sam declaring all left-handed Americans to be foreigners* – a policy that would be just as sensible and effective as the one Mr. Obama proposes.

Sincerely,
Donald J. Boudreaux

* Deirdre N. McCloskey, Bourgeois Dignity [2] (University of Chicago Press, 2010), p. 212.  Deirdre’s example is of England; in my letter I change it to American.

Comments