This is how chapter 12 of Naked Economics starts, praising trade and how valuable it is as a tool for us. Imagine for a couple of seconds, what would theUS be if they could not trade across the Mississippi river, or if Peru couldn't either export or import goods. How does a country develop? How do people get chances to specialize?
When we ask ourselves if trade is valuable, the answer is simple. Yes. Even though to an extent trade has more benefits on rich countries than on developing countries, making the gap between those larger. If we were to consider relativity, poor countries are not gaining. But what would happen to developing countries without trade. Once we imagine that, the answer seems obvious. Wheelan gives the examples of child workers in Bangladesh. When the government found children producing clothing for Wal-Mart, they stopped those children completely. In their case, kids didn't go to school. There were three different outcomes for all kids, all of them equally popular. Some of them found even worse jobs. Others, ended up in the streets. The rest were forced into prostitution. Clearly, trade does help developing countries by giving them access to markets in the developed world, where most of the consumers are. Something we must always keep in mind is that trade is always voluntary, so if somebody chooses to do it, it's because he has the chance to receive something of value from the exchange.
Trade effectiveness is simple: there is no point in someone from Silicon Valley needing to produce his food or clothes. He can add more value and push the world forward by creating technological advances. The same with Seattle engineers.
"Productivity is what makes us rich. Specialization is what makes us productive. Trade allows us to specialize."
After discussing the chapter in class, we reached some great conclusions about trade through picturing examples that we experience and thought about what role it has in our lives. What would happen if somebody from San Juan de Lurigancho received similar opportunities to those I have access to? Would he be more productive than I am?
In general, it was a great experience and a really valuable talk, in which we got to understand deeply a concept that is extremely valuable for us and found an effective and simple way to remember what you learn.