Classical and Neoclassical trade theory makes the case that free trade can bring a country to an optimum and economically efficient use of its resources; and, hence, it is an optimal trade-policy if the objective is maximizing long term economic growth. There are those who argue that the experience of the Asian Miracle countries, such as Taiwan, South Korea, and Singapore, verify this argument in the real world. Do you agree? Why or Why not?
In the 1960s and 1970s the newly industrialized countries in the Asia-Pacific region including South Korea, Taiwan and Singapore exhibited vigorous economic performance (Yoshimatsu, 2000, p. 5). In order to duplicate these countries' economic success in other developing countries in the third world, it is important to know and understand the underlying reasons of their growth. However, economists differ on what these causes are exactly.
Classical and neoclassical economists argue that the phenomenal growth of the so called Asian miracle countries result from a liberal trade policy, in other words promotes free trade. Specifically, ...
Optimal trade policy for long term growth is examined.