Ricardo's theory is absolutely right-within its narrow confines. His theory correctly says that, accepting their current levels of technology as given, it is better for countries to specialize in things that they are relatively better at. One cannot argue with that. His theory fails when a country wants to acquire more advanced technologies-that is, when it wants to develop its economy. It takes time and experience to absorb new technologies, so technologically backward producers need a period of protection from international competition during this period of learning. Such protection is costly, because the country is giving up the chance to import better and cheaper products. However, it is a price that has to be paid if it wants to develop advanced industries. Ricardo's theory is, thus seen, for those who accept the status quo but not for those who want to change it.
Ha-Joon ChangRelated topics
backward chance change competition country current economy experience given giving import international learning narrow need pay period price protection seen status technology theory thus time confines things quoRelated quotes
I want to mention the British Government's attitude to poorer countries in relation to 1992 and the EEC. There was a delegation here recently led by Mr. Julian Hunte from St. Lucia concerning the implications of the Single European Act for the survival of the Windward Islands. There is a problem because of the likelihood of the closure of markets for bananas and some of the smaller eastern Caribbean countries and the low price that the producers receive for them. It is necessary for the British Government to do something to protect the markets that those islands have traditionally enjoyed. If not, they will become seriously impoverished and further indebted. They will lose out because of Britain's obsession with moving deeper into the Common Market and accepting the Common Market's single economy rather than protecting those who have traditionally supplied goods to this country.
Jeremy Corbyn
Remember, every business firm, like even a mom and pop grocery store, is a market imperfection. A firm is defined in economic theory as a market imperfection introduced to deal with transaction costs. And the sort of theory is that the imperfections, the firms, are kinda like little islands in a free market sea. But the problem with that is that the sea doesn't remotely resemble a free market, and the islands are bigger than the sea; so that raises some questions about the picture. But these market imperfections, like a firm, or a transnational corporation, or a strategic alliance among them, this is a form of administering interchanges. And there's a real question about whether we want to accept that. Why, for example, should the international socioeconomic system, or for that matter our own society, be in the hands of unaccountable private tyrannies? That's a decision, it's not a law of nature.
Noam Chomsky
To take what might seem an "objective", macro-economic approach to the origins of the world economy would be to treat the behavior of early European explorers, merchants, and conquerors as if they were simply rational responses to opportunities-as if this were just what anyone would have done in the same situation. This is what the use of equations so often does: make it seem perfectly natural to assume that, if the price of silver in China is twice what it is in Seville, and inhabitants of Seville are capable of getting their hands on large quantities of silver and transporting it to China, then clearly they will, even if doing so requires the destruction of entire civilizations. Or if there is a demand for sugar in England, and enslaving millions is the easiest way to acquire labor to produce it, then it is inevitable that some will enslave them.
David Graeber
THEY who are acquainted with the present state of the theory of Symbolical Algebra, are aware, that the validity of the processes of analysis does not depend upon the interpretation of the symbols which are employed, but solely upon the laws of their combination. Every system of interpretation which does not affect the truth of the relations supposed, is equally admissible, and it is thus that the same process may, under one scheme of interpretation, represent the solution of a question on the properties of numbers, under another, that of a geometrical problem, and under a third, that of a problem of dynamics or optics. This principle is indeed of fundamental importance; and it may with safety be affirmed, that the recent advances of pure analysis have been much assisted by the influence which it has exerted in directing the current of investigation.
George Boole
Third Theory.-According to this theory, there is nothing in the whole Universe... that is due to chance; everything is the result of will, intention, and rule. It is a matter of course that he who rules must know. The Mohametan Ashariyah adhere to this theory, notwithstanding evident absurdities implied in it. ...The Ashariyah were therefore compelled to assume that motion and rest of living beings are predestined, and that it is not in the power of a man to do a certain thing or to leave it undone. ...It follows also from this theory, that precepts are perfectly useless, since the people to whom any law is given... can neither do what they are commanded nor abstain from what they are forbidden. ...According to this theory, it must also be assumed that the actions of God have no final cause. All these absurdities are admitted by the Ashariyah for the purpose of saving this theory.
Maimonides
