ABSTRACT
I recently offered a brief survey of the progress made over two and a half centuries in answering the fundamental questions of Montesquieu (1749) concerning the gainfulness of international trade for individual trading countries; see Kemp (2003b: ix-xii). The survey began by recalling the inadequacy of the normative contributions of Adam Smith (1776) and David Ricardo (1817), the result of their dependence in crucial passages on the assumption of a representative agent in each trading country. Given that assumption, the question of trade gains becomes quite trivial: either all households benefit from trade or all households suffer from trade or, the singular case, all households are indifferent to trade. And yet the analysis provided by Smith and Ricardo formed the foundation of nearly all academic discussion of trade gains throughout the nineteenth century and indeed well into the twentieth century.
