What’s also missing from Rodrik’s story is how the policy change [to freer trade] came about. If Nicholas loses and John gains from repealing a trade barrier, then doesn’t that mean that at some point in the past it was Nicholas who gained at John’s expense when that trade barrier was first imposed? And so here we have in a nutshell the negative impact of protection. When a barrier is imposed, the protected party (in this case Nicholas) gains $200, but only by imposing a cost of $300 on John. The $100 loss in total societal wealth is what an economist would call the “deadweight loss” of trade barriers — lost efficiency for both producers and consumers.
David Boaz reflects on socialist experiments.
Barry Brownstein identifies a key, serious flaw fueling the faith in democratic socialism.
Sam Staley reviews Won’t You Be My Neighbor?
Dan Mitchell explains that poverty is conquered not by the welfare state but by free markets.
