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alaxhn | 10 months ago

I broadly agree that free trade increases the pie and is beneficial. I would still like to point out that I can think of two examples where the pie might actually decrease even while conceding in the vast majority of cases the pie does increase and that free trade is largely a good thing.

(1) The comparative advantage of a country is that they do not have strict environmental standards and becomes the low cost leader in a "dirty" industry.

(2) An individual in the rich country loses their job to an individual in the poor country who produces exactly the same level of output at lower cost and the individual in the rich country ends up having to subside on government benefits

For both of these examples, shareholders profit financially from the outsourcing (and so I would argue it is likely happen) even as the world in example 1 or the rich country in example 2 loses out.

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