The Economics and Ideology of Free Trade

The Economics and Ideology of Free Trade

An Historical Review

Leonard Gomes

The Economics and Ideology of Free Trade makes an important contribution to the debate on globalization by providing much needed intellectual and historical perspective on the issue of Free Trade versus Protection.

Chapter 6: The Economists, the Corn Laws and Commercial Policy

Leonard Gomes

Subjects: economics and finance, economic psychology, history of economic thought, international economics

Extract

6.1 THE ECONOMISTS AND THE CORN-LAW DEBATE The repeal of the English Corn Laws on 26 June 1846 was an epoch-making event in the history of international economic policy. The decision was significant, perhaps more because of its symbolic value than for any dramatic impact on international economic relationships. It was, however, preceded by a momentous and controversial debate in which most of the best minds in classical political economy participated. Nothing comparable to it was seen until a century and a half later, that is, the protracted debate on Britain’s membership of the EEC (European Economic Community) – except, perhaps, for the British Tariff Reform Debate, 1903. As in another famous economic debate – the early seventeenth-century controversy on the foreign exchanges and the balance of payments – which engaged the attention of leading economic thinkers, the nineteenth-century discussion was accompanied by a great outpouring of economic writings. The shift in policy leading up to the rescinding of agricultural protection has been hailed as one of the greatest triumphs of enlightened economic reasoning, in particular, the law of comparative cost. But this is pure invention, a caricature of the facts as far as they can be ascertained. The myth does not stand up to scrutiny. Thweatt writes ‘it is misleading to say the doctrine of comparative costs was influential in the discussion leading to the repeal of the Corn Laws in 1846’ (Thweatt 1976, p. 208). Surveying public opinion at one of the crucial moments (1820) when the first decision...

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