The Choice: A Fable of Free Trade and Protectionism Updated Edition

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9780130870520: The Choice: A Fable of Free Trade and Protectionism Updated Edition

This supplement is appropriate for principles of economics, surveys of economics, international economics, international trade, or managerial economics. No prior economics is assumed, but the material can be taught at all levels. *Written as a novel, the book makes the complex concepts, issues and terminology of international trade understandable for students. *David Ricardo comes to life to discuss international trade theory and policy with Ed Johnson, a fictional American television manufacturer seeking trade protection from television manufacturers. Their dialogue is a sophisticated, rigorous discussion of virtually every major issue in trade theory and policy. To illustrate the positive and normative effects of international trade and trade policy, Ricardo takes the reader and Ed Johnson into the future to see an America of free trade and an America of complete self-sufficiency. The fictional element brings these topics to life so that students gain the intuition and understanding of how trade changes the lives of people and the industries they work in.The fundamental intuition of how international markets function including general equilibrium effects and policy analysis is provided.

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From the Publisher:

David Ricardo comes to life to discuss international trade theory and policy with Ed Johnson, a fictional American television manufacturer seeking protection from Japanese televisions. Their dialogue is a sophisticated, rigorous discussion of virtually every major issue in trade theory and policy. To illustrate the positive and normative effects of international trade and trade policy, Ricardo takes the reader and Ed Johnson into the future to see an America of free-trade and an America of complete self- sufficiency. The fictional element brings these topics to life so that students gain the intuition and understanding of how trade changes the lives of people and the industries they work in. The fundamental intuition of how international markets function including general equilibrium effects and policy analysis is provided.

From the Inside Flap:

Preface

In the early 1990s, when this book was first published, many Americans were deeply fearful of Japan. Analysts, experts, and pundits claimed that the Japanese government and Japanese companies were waging and winning an economic war against the United States. Highlights of the Japanese strategy included subsidies to key technologies and excluding American products from the Japanese market. Some experts urged America to get tough with Japan; others wanted America to fight back by copying Japan's policies.

Much of the first edition of this book was devoted to a different point of view, rejecting the whole concept of economic warfare at the national level and arguing that although Japanese and American companies are in competition, Japanese success does not come at the expense of America. The debate seems quaint today; the Japanese economic malaise and the extraordinary performance of the American economy have pushed the Japanese-American economic relationship out of the headlines and out of the minds of the American people.

In this revised edition, I have de-emphasized the discussion of Japan's economic relationship with the United States. I do this with some trepidation. When the American economy falters and Japan's recovers, we will surely hear again of why Japan is a threat to the United States. So I have left in some of the material about Japan to innoculate the reader against future outbreaks of Japan-bashing.

In addition to de-emphasizing the U.S.-Japan relationship, I have added discussions of topics that have grown in importance since the early 1990s. In particular, I have added a new chapter on trade deficits (chapter 10) and a new chapter on trade with Mexico and low-wage nations (chapter 12).1 have added discussions of environmental issues, labor standards, and the World Trade Organization. I have moved the date of the story from 1995 to 2000 and updated. the data where relevant. I have included discussions of recent developments like the Internet and moved and merged material from the first edition in ways that make more sense to me now.

Russell Roberts (roberts@csab.wustl)
Center for the Study of American Business
Washington University in St. Louis

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Roberts, Russell D.
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Roberts, Russell D.
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