Neither Free Trade Nor Protection

Neither Free Trade Nor Protection

A Critical Political Economy of Trade Theory and Practice

Bill Dunn

This book challenges both sides of the debate around international trade. Most mainstream economists advocate free trade as a mainstay of national and global prosperity. Meanwhile, many critics see trade causing inequality and poverty. Unfortunately, supporters and opponents share many assumptions about trade and the character of the international economy and produce similarly abstract and asocialized theories. Their propositions need to be investigated critically, and in doing so, this book begins the task of assessing when and how trade matters.

Chapter 2: The making of world trade

Bill Dunn

Subjects: economics and finance, political economy, politics and public policy, international politics, political economy


This chapter cannot provide a sufficient history of the many hundreds of years of world trade but an understanding of the past, of how trade has changed and even meant different things, helps inform the arguments and evidence of the rest of the book. But if history helps to make sense of theory, history itself never arrives untainted. How we write history, on which events we focus and how they are interpreted involves making choices, which are themselves informed by theory; or too often informed by unacknowledged prejudices. History, as Cox (1981) says of social theory more generally, is always for someone and for some purpose and this chapter uses history to make several arguments. The history here contests a pervasive narrative of the gradual triumph of free trade, the market and what Smith calls commercial society (Heller 2011). It becomes obvious that international trade precedes modern capitalism by several millennia while the concomitant rise of trade and capitalism hardly involved laissez-faire. The history reminds us that trade is an active process. While the traders themselves are intermediaries who seldom warrant a mention in modern textbooks or contemporary discussions, they are hard to miss in any serious narrative, for example in the Dutch VOC (East India Company) and the British East India Company or the Atlantic slave ships of the seventeenth and eighteenth centuries. Time and again it becomes obvious that trade involves relations of power.

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