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economics of globalization reaction essay

The assignment is to read the following two essays on comparative advantage and trade, then write a response essay on the topic.

1. The first essay is by the economist Paul Krugman, who is a columnist for the New York Times. He won the Nobel Prize in Economics in 2008 for his contributions to trade theory. The Nobel Committee explains,

“Traditional trade theory assumes that countries are different and explains why some countries export agricultural products whereas others export industrial goods. The new theory clarifies why worldwide trade is in fact dominated by countries which not only have similar conditions, but also trade in similar products – for instance, a country such as Sweden that both exports and imports cars. This kind of trade enables specialization and large-scale production, which result in lower prices and a greater diversity of commodities.”

Krugman’s essay is from a book of essays on international economics. The essay is called “Ricardo’s Difficult Idea” and discusses why he believes so few people share the consensus of professional economists on comparative advantage.

Link to the essay: http://web.mit.edu/krugman/www/ricardo.htmLinks to an external site.

2. The second essay is titled “A Petition” by the 19th Century political economist Frederic Bastiat. The essay is sometimes also referred to as “The Candlemaker’s Petition”, and it is a satirical essay that deals with common objections to international trade.

Link to the essay: http://econlib.org/library/Bastiat/basSoph3.html#S.1, Ch.7, A Petition (you may have to copy and paste this link).

The assignment is to write a response to these essays that discusses the following questions:

1) Who was the audience for each essay? How did those audiences differ?

2) Are the arguments presented largely positive or normative? Do the authors tones differ?

3) What positive argument is each author giving in support of open trade? Do they directly address common objections?

Your response should not exceed 2000 words, and should be at least 1250 words.

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