[FR] Free Trade Today: The Capital Myth by Jagdish Bhagwati

This short book that can now be called a classic, presents itself as a compilation of the texts of three lectures delivered by the author. The text of the three conferences was published for the first time in the United States by the Princeton University Press under the title Free Trade Today. In The Capital Myth, Bhagwati refutes any parallel between free trade and free movement of capital. (available in french only)

The book is prefaced by Pascal Lamy, who points out that the benefits of free trade, which are generally well distributed, are difficult to perceive on a daily basis and in the short term, whereas the costs, which are lower, are highly visible, tangible and concentrated in space and time. This is the thesis of The Logic of Collective Action, in which Mancur Olson explains why the concentrated and easily mobilised interests of producers prevail over the diffuse and difficult-to-organise interests of consumers, who represent the general interest. The Director-General of the WTO advocates a special fund to cushion the effects of unexpected trade shocks.

In his introduction to the French edition, the author places Abbé de Condillac on the same level as Adam Smith as the founder of the theory of free trade. The former’s essay, ‘Commerce and Government Considered Relatively to Each Other’, dates from 1776, the year of the publication of ‘The Wealth of Nations’.