| CWE ch. 2 | European classical economic liberalism: Smith, Ricardo, Cobden, Mill, Bagehot (pp. 19–36) |
| CWE ch. 3 | Non-European reception and adaptation: Americas, South Asia, Africa/Ottoman lands, East Asia (pp. 37–55) |
| Aggarwal & Dupont | Why cooperation is hard, and how institutions solve it — the analytic bridge from history of ideas to IPE theory |
| Lake Depth | Open Economy Politics: linking international structure, domestic interests, and policy outcomes (graduate-level; optional) |
Free trade generates global prosperity
Free markets promote international peace
Economic freedom secures individual freedom
Beyond these three, disagreements existed among liberals.
"It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own self-interest." — Adam Smith, The Wealth of Nations, 1776
| Efficient allocation | Restrictions give protected firms "monopoly of the home market," drawing capital from more valuable uses |
| Consumer benefit | Free trade prevents consumers being "sacrificed" to inefficient domestic monopolies |
| Outlet for surplus | Trade employs resources that would otherwise sit idle |
| Dynamic gains | Competitive pressure, larger markets, "mutual communication of knowledge, and of all sorts of improvements" (Smith 1776) |
| Retaliation | Justified only if likely to get a trading partner's restrictions lifted |
| Gradual transition | Sudden liberalization after long protection could cause mass job loss; "freedom of trade should be restored only by slow gradations" (Smith 1776) |
| Tax equalization | Tariffs to offset foreign goods taxed lower abroad |
| National defense | Endorsed England's Navigation Acts: "the wisest of all the commercial regulations of England" (Smith 1776) |
Smith evaluated policy by state wealth and power — more cautious than many 19th-century followers.
Watson 2017: Ricardo's abstraction omits the coercive 1703 treaty and Brazilian-gold financing behind the actual England–Portugal trade.
"In many cases, the eagerness of England in the Free-trade cause only does that cause harm." — Walter Bagehot, on the 100th anniversary of The Wealth of Nations, in Helleiner 2023: 31
"You shall not press down upon the brow of labor this crown of thorns; you shall not crucify mankind upon a cross of gold." — William Jennings Bryan, Democratic National Convention, July 9, 1896
| Americas | South Asia | Africa / Ottoman | East Asia | |
|---|---|---|---|---|
| Key figures | T. Cooper US South — defended slaveryBolívar · Prieto · Bilbao anti-colonial liberty | Rammohun Roy developmental liberalismNaoroji "drain theory" | Equiano free trade vs. slave tradeCrummell LiberiaD'Ghies Ottoman reform | Yan Fu 1901 Wealth of Nations trans.Taguchi Ukichi Japan |
| Adaptation | Free trade tied to independence from colonial trade restrictions | Free trade + active state modernization; critique of colonial "drain" | "Legitimate commerce" to replace slave trade; liberal reform via empire | Liberalism as path to national wealth and power; local intellectual roots claimed |
Colonial "despotism" justified paternalistically — colonized peoples "not yet ready" for self-government; worked for the East India Company, 1823–58
Engaged liberal imperialism sympathetically at first, hoping British rule could be a progressive force; Naoroji later called for self-rule
Opposed the use of force to spread free trade; rejected the "barbarian" framing of China
| Commercial liberalism | Trade creates interdependence; war becomes costly |
| Institutional liberalism | Rules, norms, and organizations facilitate cooperation |
| Republican liberalism | Domestic regime type shapes foreign policy; democracies don't fight each other |
| Prisoner's Dilemma | Mutual cooperation best, but defection is the dominant strategy |
| Stag Hunt | Coordination game; cooperation preferred only if assured of the other side |
| Country B | |||
| Cooperate | Defect | ||
|
Country A
|
Cooperate |
3, 3
mutual cooperation
|
0, 5
A cooperates, B defects
|
| Defect |
5, 0
A defects, B cooperates
|
1, 1
mutual defection
|
|
Payoffs illustrative; higher = better for that country. Applied discussion cases: tariff escalation in the Canada–US trade dispute · WTO/USMCA dispute-settlement rules as an institutional tie raising the cost of defection · Canada's push to build new trade institutions and partners outside the US-centered order.
| Information sharing | Fora for communication; open procedures reduce uncertainty |
| Monitoring & enforcement | Track compliance, identify defectors; reputation costs, authorized retaliation |
| Repeated interaction | Ongoing relationships replace one-shot encounters |
| Extending the shadow of the future | Makes tit-for-tat reciprocity credible; raises the cost of defecting today |
| Issue-linkage | Trade-offs across policy areas |
Caveat: institutions have no per se power to compel states to obey.
| International | Structure of the global economy; rules of trade |
| Domestic | Distribution of interests and preferences among groups |
| Sectoral | Who wins and loses from a given trade policy? |
Applied to Helleiner: explains why Britain moved to free trade in the 1840s (industrial interests) while others resisted (agricultural interests, infant industries).
| Helleiner (history of ideas) | Lake (OEP) | Aggarwal & Dupont | |
|---|---|---|---|
| Mechanism | Smith's invisible hand decentralized coordination | Domestic interests drive trade policy | Institutions enable coordination |
| Peace claim | Cobden "free trade = peace" | Commercial liberalism strand | Interdependence raises cost of defection |
| Exceptions | Defense, infant industry Smith, Mill, Naoroji | Domestic politics explains variation | When institutions succeed or fail |
| Invisible hand | Decentralized market coordination of self-interested action (Smith 1776) |
| Comparative advantage | Mutual gains from trade even without absolute efficiency advantage (Ricardo 1817) |
| Most-favored-nation clause | Commits parties to extend future trade privileges to each other (Cobden–Chevalier, 1860) |
| Drain theory | Colonial wealth transfer from colony to metropole (Naoroji 1867) |
| Open Economy Politics | Explains trade policy via domestic distributive coalitions |
One doc, all semester — find this week's heading, add your name, role, and question (include your article link if you're the Applier).
Post it to the shared Discussion Questions doc before Thursday's class.
"You're at war when you get attacked. We got attacked." — Prime Minister Mark Carney, Aug 22, 2026
Carney frames retaliation as self-defense, not protectionism. Using Lake's OEP framework: is dollar-for-dollar retaliation better explained by domestic coalition politics (which industries get protected), or by Aggarwal & Dupont's collaboration problem — and does either answer still count as "liberal"?
Weak version (avoid): "What do you think about the US–Canada trade war?" — no reading tied in, no claim, nothing to disagree with.