Tuesday, May 01, 2007

Moral Aspects of Trade

Alex Tabarrok has a good post on the morality of free trade at Marginal Revolution:

Peter wishes to trade with Jose. The individualist says the relevant moral community is Peter and Jose and presumptively no one else. Trade, the right of association, is a human right and on issues of rights the moral community is the individual. When Jose offers Peter a better deal than Joe it's wrong - a moral outrage - for Joe to prevent Jose at gun point from trading with Peter.

The more common view expressed implicitly by Dani Rodrik, but by many others as well, is the nationalist view, the moral community is Peter and Joe. Joe gets a vote on Peter's trades. Peter should be allowed to trade only if both Peter and Joe benefit, otherwise too bad. Jose counts for less.

A third view, that of the liberal internationalist, says that Peter, Jose and Joe count equally and are together the moral community.

I can easily fit into either the individualist or liberal interationalist camps. Lines on a map shouldn't have anything to do with trade. And free trade increases the wealth of the world as a liberal internationalist would claim.

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