Hacker News Reader

Ricardo's mistake is not thinking about development; comparative advantage is optimal now, but a society that just makes coffee beans is going to lose in the end to the one that makes microchips because of the difference in how the economy and society develop over time.

View on HN

This may have been a mistake by Ricardo, but not one that points towards less trade as optimal. Indeed, export-led development (implying more trade openness) is the one reliable way we know about of going from the "coffee beans" to the "microchips" stage of development.

False, I recommend Ha-Joon Chang's writing on this subject. The US did not develop in a climate of trade openness, it used tariffs to protect its development. In fact no developed economy developed this way, all of them protected their industry until it was mature and ready to compete, had their governments invest in research and infrastructure and so on. If you have an example of a country that successfully developed through export led development and trade openness I would love to hear it.

Reply on news.ycombinator.com