ABSTRACT
International trade, and its effects, need to be analysed in the historical context within which it occurs. This may not be a popular proposition among model-building economists for whom ‘history does not matter’, but can be readily accepted by a broad body of political economists, political scientists and historians. For much of the nineteenth century, for example, international trade was harnessed to meet the needs of empires, the ‘colonial trade’ serving the interests of the imperial centre. In the post-1945 period, the relatively unrestricted flow of goods and services was a central objective of the Bretton Woods system. However, concomitant restrictions on the flow of international capital were designed to protect national autonomy by providing countries with the policy space to pursue their own objectives.
