On the Smithian Origins of "New" Trade and Growth Theories

Abstract

Adam Smith is generally ignored as a trade theorist in textbooks and surveys because of the common belief that he only confirmed the rule of absolute advantages to explain structure of foreign trade. On the other hand, many textbooks and surveys on growth theories simply overlook Smith's significant contributions to growth theory. However, his vent−for−surplus approach may be interpreted as a pioneering study which stresses the importance of economies−of−scale in explaining the structure of trade. Furthermore, in Smith ( 1776), both learning by doing and economies−of−scale are crucial to explain long−run growth. This short paper addresses to the undeniable influence of Smith's concepts such as "extent of the market", "division of labor", "improved dexterity in every particular workman" and "simple inventions coming from workman" on both recent trade and growth models. The note mainly is based on a schematic outline of Smith's ideas on the nature and causes of the wealth of nations.

Are Countries Participating into Regional Integration Performing Better in Growth and Liberalization Than Non-Participators? A Study on European Countries

“…Adelman (1961) indicated human resource acquisition of the economy, technological improvement, amount of capital investment, natural resource endowment and degree of its exploitation and managerial know-how as the determinants of economic growth. Along with capital accumulation technological progress and institutional and social factors have been positioned by Kibritcioglu (1997). Romer (1986) and Lucas (1988) recognized that growth rate depends on R&D technology, the degree of firms' monopoly power and time horizon of investors.…”

Relaciones funcionales entre comercio exterior y PIB: los casos de México y Estados Unidos

“…El problema que surge al aplicar el principio de Smith es que un país terminaría produciendo la mercancía en la cual es más eficiente (medido en menores horas de trabajo) y el resto del mundo no tendría porque producir una sola mercancía. No obstante, para Kibritcioglu (2002) la idea de ventaja comparativa fue originalmente concebida por Smith, aunque tal vez no en términos suficientemente explícitos. Esta idea de ventaja comparativa puede hallarse en el siguiente pasaje:…”

“…"What is prudence in the conduct of every private family can scarce be folly in that of a great kingdom. If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage" (citado por Kibritcioglu, 2002)." Según Kibritcioglu, Smith, con su noción de ventaja comparativa, permitió adelantarse a Ricardo.…”