PARTICIPANTS
Douglas Irwin, Elizabeth Caucutt, John Cochrane, Darrell Duffie, John Gunn, Bob Hall, Tim Kane, Arvind Krishnamurthy, David Mauler, George Shultz, Pierre Siklos, John Taylor

ISSUES DISCUSSED
Douglas Irwin, the John Sloan Dickey Third Century Professor in the Social Sciences at Dartmouth College, discussed “Lessons from U.S. Trade Policy History.” Irwin began by pointing out that trade policy in the U.S. almost exclusively refers to import tax policy—taxes on exports are unconstitutional and subsidies are effectively absent for both exports and imports. Irwin identified two themes that encapsulate the subject matter of a historical analysis of trade policy: determinants of movements in the tariff rate and effects of tariff rates on the U.S. economy. Referencing these themes throughout the discussion, Irwin reviewed the timeline of trade policy. He first discussed the pre-Civil War era, then the high protection era (1860-1934), and finally the free trade era (1934-present). After reviewing the historical timeline, Irwin expressed both encouragement and concern over the current state of trade policy. At the present, world trade is flourishing with more liberal trade policies than ever before in history. This was evident by the lack of protectionism during the recent global crisis. However, big trade deals appear to be no longer feasible at the WTO and U.S. trade politics have become increasingly polarized. Irwin also noted that trade reform is only likely if domestic exporters benefit directly. The average consumer, who stands to benefit from cheaper products through increased real wages, has limited lobbying influence.