I enjoy reading a blog called the Conversable Economist. Yesterday, the blog entry was about Global Trade, http://conversableeconomist.blogspot.com/2013/09/shifting-patterns-of-global-trade.html.
The major points were that:
* International trade was growing as a percentage of the world economy, increasing from less than 20% to nearly 33% over the last 20-30 years
* Most of the increase has been in manufacturing (one of the interesting points)
* Around 2/3’s of all trade occurs within a very small number of multinational companies. The top 1% of US exporters accounted for 80% of all exports. In developing countries, the top five exports in those countries tended to also control around 80% of a countries exports (really interesting point)
* Trade used to be north-north (between high-income countries), now only 1/3 is north-north with both north-south and south-south increasing rapidly
* Tariffs have become less and less a barrier to trade (take that WTO), the bigger problem is transportation and communications infrastructures (big implications for public policy focus, something I do not believe we realize)
* Remittances from migrants continue to be very important, in 2012 they totaled over $400b. This is three times the size of total foreign aid (this also has big implications for public policy focus and again it is not clear that we have thought through the implications)
* Comparative advantage is changing (where exporters invest and the decisions they make tend to have greater impact than the historical comparative advantages that a country might provide)
As with many issues, reality often clashes with intuitive notions and in particular with ideological approaches. Comments?