GGR365H5 Midterm: ggr365 midterm test.doc
Document Summary
Most agree that globalization rests upon, or simply is, the growth in international exchange of goods, services, and capital, and the increasing levels of integration that characterize economic activity. Smith made a powerful case that government promotion of trade and government restriction of trade were unwise and harmful. He fundamentally changed the analysis of trade policy and essentially established the presumption that free trade was the best policy unless some other considerations overrode that presumption. Smith argued that economic growth depended upon specialization and the division of labor (see book i, chapter 3). Richard: one of the most profound insights of economics is that activities of billions of people can be coordinated without central direction and without most of these iterdependent people knowing anything about one another. Among the benefits from an extended division of labor, he explains, are that risks can be shared, greater specialization can be developed, and a wider accumulation of knowledge can occur.
