I have never read a book of a critique but i am glad at least now i did that. Bad Samaritans, written by Ha-Joon Chang a Korean economist, hits at the epi center of the world trade policies and their problems. The world as i know, started after 1991 crash and exposure to the chronological order of events before and that and their impact, for me at least is from Thomas L Friedman and his active contribution to the Globalization. Its the Berlin wall isn’t it !!

Globalization from an Economists angle looks much different. The most important thing here is the regulations on the industries based on tariff regulations. Initially when colonies existed, the colonies or currently developing nations were forced to follow free trade policies. This free trade policy has in many ways made those nations under privileged.

When Developed countries had industries like textiles in the primitive states they levied heavy tariff’s on imports. Overtime the domestic industries became competitive enough and then the tariff’s were reduced. Now they are forcing the developing nations into free trade and exporting their technology and products at a fair price. However the developing nations don’t also have a choice. What the developed countries did long time back was termed as protectionism. It is against free trade and thus also against globalization.

Without these policies many of the Briton’s industries would be wiped out. By the time these policies were abolished in 1860 from its colonies, it was too late, Briton was already having the competitive advantage on technologies.

Same was the case with the US. Alexander Hamilton went across the argument of Adam Smith and framed a report to go for import bans, higher export tariff’s; ban on the export of key raw materials. Initially lot of the politicians did not agree, but later when Anglo-American war broke out in 1812, they had to ban all exports and imports and increase tariffs. The blueprint given by Alexander Hamilton was followed after the second world war. He was the person who coined the term ‘infant industry’.

The key historic events for which the tariff’s stayed at an all time high is the 1812 Anglo-American War ( 1812-1816 ), 1921 ( First world War ), Second world war and Great Depression ( 1912 ). In such a situation the governments don’t have any choice.

The two contrary examples for protectionism are US and Mexico. Mexico tried freeing the trade policies and succeeded in showing growth. US on the other side was protectionist all the way, however still succeeded.

But when Brettonwood institutions was formed, they started intervening with the economic policies of the Developing and under developed nations. The borrowed money from the IMF and World Bank is so high for some nations that they have to let the Brettonwood institutions to closely monitor their fiscal economic policies. What a series of events ! Till date the countries like india have a lot of debt and still cannot sustain the markets when they are still struck with olive tree issues, less innovation. They are still dependant of technology from other nations like Russia for Defence technologies and US for outsourcing.

With all of them turning to free trade there came WTO into picture !