Customer Reviews

Economics and World History: Myths and Paradoxes

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Paul Bairoch's "Economics and World History" aims to dispel many common myths about, well, economics and history. Although he addresses a multitude of different specific subjects and examples (like sugar trade and coal vs. oil), he focuses mainly on a few important issues that he impresses on the reader:

- Free trade is historically the exception, not the norm;
- Free trade does not lead to more growth for most nations;
- The 19th century had a much slower growth rate than the 20th, overall;
- Agricultural production in the Third World is more costly than in the First; and
- European colonialism was largely not profitable.

Bairoch does not pay much attention to showing whether these things really are common myths or not, but even if they aren't, it is still useful to have an overview of historical evidence regarding these subjects, especially considering the political consequences of some. And this he does very well: though the discussion of some more controversial claims is really too short to be entirely convincing, he clearly has done a great amount of research on the economic history of mainly the 19th and 18th centuries, and his discussion of the literature is clear and concise.

Overall he seems to prove his case in most, if not all, cases and particularly case for protectionism in underdeveloped nations, which he clearly supports. A good addition to economic and historical bookshelves.

If you are interested finding good counter arguments to our omnipresent free trade movement salesmen, this might be the book for you. The book is very concise, less than 200 pages, but makes an excellent presentation of highly pertinent economic facts to counteract some of our most persistent economic myths.

The author makes the argument that free trade is not the universal solution for a lack of economic development. Effectively, the US was a protectionist country from it's earliest founding until WWII. It was only after the war that we turned enthusiastically to free trade. As well we should have, considering that Western Europe's and Japan's industry lay in ruins. It made total sense and the US made the most of it. 25 years later, though, the US slipped into a trade deficit with the rest of the world from which it has never emerged.

The author points out that the surest way to prosperity is through industrialization. Exporting primary products (e.g., coffee, wheat, cotton, bananas, etc.) is not a bad economic policy and highly appropriate for given countries. But you cannot leave industrialization out of the equation for increasing national prosperity. De-industrialization, as he points out, is a sure road to economic ruin. He uses the example of Latin America in the 19th century as his case study--the book was published in the early '90's. If he were writing a new edition today, I believe he would probably use the U.S.'s de-industrialization in the late 20th and early 21rst centuries as a sure road to ruin case study.

However, he's not an ideologue on the subject. Sometimes free trade is the entirely appropriate policy of a nation. However, more often than not it appears that protectionism is entirely warranted. His statistics seem to support that latter view more strongly.

He also covers the argument that the Western world largely depended upon the colonial world for its development. The exploitation of the southern countries was necessary for the northern countries to arise. He points out that the US in particular, as well as western Europe, were almost entirely self-sufficient in raw materials and foodstuffs well into the middle of the 20th century, the exploitation argument is a bit hard to sustain. He also points out that Smoot-Hawley, contrary to popular business rhetoric, did not cause the US depression of the 30's, but was, instead, the result of it. He makes that case very strongly.

This is an excellent book. I would highly recommend that anyone interested in the free trade/protectionism debate read it. It will dispel many myths. Besides being concise, it is well-written and quite readable. You might find the statistics a bit slow going, but they are presented in a very understandable fashion.

Really great book, which makes me think about so many beliefs, which could be false assumptions. This book is a must for everybody with critical view on economic history, for people, which prefer analysis to authority opinions.

Bairoch's book is a classic and despite its fairly technical subject easy to read.