The Critiques of Free Trade: a Refutation

It is a pleasure to be lecturing at the World Bank today. As it happens, the Bank has entered my life at several points. One of my most remarkable teachers was Paul Rosenstein-Rodan. He was among the earliest two economists of great distinction --the other being Sir Alec Cairncross who joined the Economic Development Institute at its founding --to have worked at the Bank. This was between his career in London and at MIT where he taught me. He developed my interest in development economics: he was the first to write about absorptive capacity in determining aid flows, and was the pioneer of the theory of balanced growth and the “big push”. I can say without exaggeration that, while he was a superb theorist, he also taught me, as did my English teachers in Cambridge, that Economics was a science with whose wise use we could rescue millions languishing in poverty. So, when I was offered the job of a Professorship in the Indian Statistical Institute and the chance to simultaneously work in the Indian Planning Commission on how to bring the bottom 30% of India’s population up to a “minimum standard of living”, I found this enormously attractive. In fact, I wound up writing then The Economics of Underdeveloped Countries (Weidenfeld & Nicolson, 1966) which was in several