ABSTRACT
The first part of this essay’s title may appear old-fashioned; the second, too fashionable! There is, however, merit in striving to maintain the continuity of economic thought while reformulating traditional principles to illuminate better contemporary problems, always a characteristic of Sir John Hicks’s (1950-1) writings. Some fifteen years after Sir John’s paper on ‘Free Trade and Modern Economies’, it may again be appropriate to attempt to throw some new light on the old story of free trade versus protection, and to cast Sir John’s paper into even more modern terms. The strongest arguments for protection now stem not so much from the economics of full employment, as was the case when Sir John wrote, but from the economics of underdevelopment. And as Sir John observes, if there is any branch of economic theory which is especially relevant to underdevelopment economics, it is the theory of international trade (Hicks, 1965).
