Editing Trade (section)

=== 19th century ===
In 1817, [[David Ricardo]], [[James Mill]] and [[Robert Torrens (economist)|Robert Torrens]] showed that free trade would benefit the industrially weak as well as the strong, in the famous theory of [[comparative advantage]]. In [[Principles of Political Economy and Taxation]] Ricardo advanced the doctrine still considered the most counterintuitive in [[economics]]:
: ''When an inefficient producer sends the merchandise it produces best to a country able to produce it more efficiently, both countries benefit.''

The ascendancy of free trade was primarily based on national advantage in the mid 19th century. That is, the calculation made was whether it was in any particular country's self-interest to open its borders to imports.

[[John Stuart Mill]] proved that a country with monopoly [[pricing power]] on the international market could manipulate the [[terms of trade]] through maintaining [[tariff]]s, and that the response to this might be [[Reciprocity (international relations)|reciprocity]] in trade policy. Ricardo and others had suggested this earlier. This was taken as evidence against the universal doctrine of free trade, as it was believed that more of the [[economic surplus]] of trade would accrue to a country following ''reciprocal'', rather than completely free, trade policies. This was followed within a few years by the [[infant industry]] scenario developed by Mill promoting the theory that the government had the duty to [[protectionism|protect]] young industries, although only for a time necessary for them to develop full capacity. This became the policy in many countries attempting to [[industrialize]] and out-compete English exporters. [[Milton Friedman]] later continued this vein of thought, showing that in a few circumstances tariffs might be beneficial to the host country; but never for the world at large.<ref>{{cite book|publisher =Transaction Publishers|date= 1970|title=Price Theory |first= Milton |last=Friedman|isbn = 9780202309699}}</ref>