In cogent and concise language,the two gifted authors upset the notion that a dollar of National Trading Income is indifferent to what is being traded. National Trading Income from a "retainable" industry like computer chips produce strategic strengths for a nation compared to the same amount of National Trading Income from potato chips.
This new vector on Global Trade alerts business leaders to rearrange intellectually their risk-reward equation to secure a more favorable outcome.
As a lay reader it was apparent that to assure our continued growth and successes that we must continually innovate to create the next big retainable industry as well as continue productivity gains to compete with low wage developing countries in easy to enter industries where we have a major interest.
An exceptionally thorough analysis of today's world of trade.
But what about today's vastly more complex economy where considerations go far beyond the mere geography of natural resource distribution? What about the role of industrialization? Or technology? Or information? Who has what advantage? And how to measure it? The authors have solved this seemingly daunting task, and present their conclusions in a few simple graphs that could fit easily onto Mr. Laffer's napkin.
How do I know that they solved the problem of reducing all the complexities of international trade to a few simple graphs? Well, I really don't know because I am not enough of an economist or mathematician to follow the technical stuff, but the authors very kindly put all that in the second half of this slim volume as kind of an appendix for the professionals. That the two authors are a leading economist and a leading mathematician is obvious from the brief biographies. And that the work passes professional muster is obvious from the blurbs. So while I can't personally check the authors' assumptions and methodology, I can accept and fully understand their conclusions as set forth in the first half of the book - the only part I read.
Not surprisingly, the graphs show that most international trade is indeed mutually beneficial. But not all. The graphs also reveal what the authors call a zone of conflict. It is to this area that attention needs to be paid. What attention do the authors suggest? Well, they are a little coy. I suspect that at this stage they are just trying to get acceptance for their framework of analysis. Anyone questioning any aspect of unrestricted free trade today is subject to being labeled a protectionist, which is only one step above racist, so the authors understandably tread very carefully.
A splendid and provocative little book dealing with a very big subject.
