Individuals, Not Governments, Have a Comparative Advantage at Improving Comparative Advantages

Source: American Institute for Economic Research
by Donald J Boudreaux

“Except for the theory of the optimum tariff, all sophisticated arguments for using protectionism to enrich the people of the home country boil down to one claim. The core claim is that government officials can design and impose protective tariffs and subsidies that cause producers in the home country to achieve ‘better’ comparative advantages than those producers could have achieved without protectionism. This argument isn’t illogical. … Protective tariffs can indeed possibly engineer into existence desirable comparative advantages that would not otherwise emerge in the home country. But this possibility is a lame reed upon which to build a case for protectionism.” (01/17/23)