The Meaning of Open Trade and Open Borders

Near the end of his 1817 treatise, “On the Principles of Political Economy and Taxation,” David Ricardo advanced the “law of comparative advantage,” the idea that each country—not to mention the world that countries add up to—would be better off if each specialized in the thing it did most efficiently. Portugal may be more productive than Britain in both clothmaking and winemaking; but if Portugal is comparatively more productive in winemaking than clothmaking, and Britain the other way around, Portugal should make the wine, Britain the cloth, and they should trade freely with one another. The math will work, even if Portuguese weavers will not, at least for a while—and even if each country’s countryside will come to seem less pleasingly variegated. The worker, in the long run, would be compensated, owing to “a fall in the value of the necessaries on which his wages are expended.” Accordingly, Ricardo argued in Parliament for the abolition of Britain’s “corn laws,” tariffs on imported grain, which protected the remnants of the landed aristocracy, along with their rural retainers. Those tariffs were eventually lifted in 1846, a generation after his death; bread got cheaper, and lords got quainter.