Miracles and Debacles: Do Free-trade Skeptics have a Case?
[Revised March 2004] Evidence gives developing countries little reason to prefer protection over free trade. Trade has been an integral part of all growth miracles (defined ass countries that have grown at 3 percent or more in per-capita terms on a sustained basis) during the last 40 years. At the same time, there is no evidence linking the debacles (defined as countries that experiences a decline in the per-capita income on a sustained basis) to trade. Nor has trade contributed to increased poverty; on the contrary, openness and growth are invariably accompanied by a reduction in poverty. Even the assertions by the World Bank that globalization-driven fast growth during the 1990s has not served the poor well, leaving the absolute number of the poor unchanged at 1.2 billion are based on faulty evidence.