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The idea of comparative advantage for trade between countries was first spelled out in 1817 by David Ricardo in "On the Principles of Political Economy and Taxa
by firstOrder 13y ago
The idea of comparative advantage for trade between countries was first spelled out in 1817 by David Ricardo in "On the Principles of Political Economy and Taxation". He used the example of the Portuguese trading their wine for English cloth, and said that it was to both countries advantage to be engaged in such free trade.
Well, two centuries later, how did that wind up? As Joan Robinson pointed out "the imposition of free trade on Portugal killed off a promising textile industry and left her with a slow-growing export market for wine, while for England, exports of cotton cloth led to accumulation, mechanisation and the whole spiralling growth of the industrial revolution".
In science, theories have to follow the data, the real world, reality. In economics, the examples and data have to be twisted to fit the theories. The OP article said the author article has a Nobel Prize in economics which of course if false, Nobel's bequeath to his prize foundation included Physiology/Medicine, Peace, Chemistry etc. but not economics - after he died people invented an economics prize and stuck Nobel's name on it so to try to give it the allure given to the other prizes. Economics uses to be called in more honest times political economy, that it was given the more scientific name economics or economic sciences was a sign of it becoming less scientific - Ricardo may have been wrong about comparative advantage, but at least he tried to take an honest look at the economy. Nowadays the theories he made which were disproved by history are held up as models, while his better ideas have been supposedly "debunked".
Economics is not a science. In its normal form it's mostly a propaganda arm for some force in society trying to justify its actions. I suppose in some sense economics could be a science, but only in the sense of being a branch of anthropology dealing with political goings on - a branch of anthropology the study of which would itself be highly politicized. One reason science works is that no astronomist gains or loses by saying the next nearest star than the sun is Proxima Centauri. It is light years away, and has little effect on things, and thus objective observation and scientific consensus are easy to achieve. If a star closer than Proxima Centauri were observed, after some time needed for verification, surely the entire astronomical and scientific community would get behind the idea that the newly observed is now the second closest star to earth. Economics fundamentally deals with the question of how the pie gets divided up, in which case scientific consensus is impossible and objectivity goes out the window. It is one of the rare subjects on which you're better off reading the material from two centuries ago - Adam Smith, David Ricardo, Benjamin Franklin, Jean-Baptiste Say, John Stuart Mill etc. - then that of today, because they were generally objective and fair, while most economic writing today is either partisan, or written under the influence of highly partisan ideas.
- atmosx 13y ago> Economics is not a science. In its normal form it's mostly a propaganda arm for some force in society trying to justify its actions. Well said, I don't think there's more to add to your comment.
- pseut 13y agoTwo centuries later, portugal and england seem to be doing pretty well. I think you'd be hard pressed to find citizens of either country that would want to go back to living conditions from 200 years ago.