Japan exploited its advantages in producing autos, and the U.S. moved on to things in which it could achieve an advantage of its own. Isn’t that exactly the way things should work in a dynamic global economy?

As I asked in a memo in September, is it a good idea for governments to try to override the laws of economics in an effort to cause their eco... See more

• There are all kinds of wrinkles and complications that affect trade, called “ frictions ”. These include things like home bias in both consumption and financial investing, sovereign default, currency market frictions, and so on. Economists argue back and forth about which of these frictions cause the various “puzzles” in international trade — disco

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