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THE ECONOMIC JOURNAL


good of one country and of all (§ 1) ; the proof that a country
may by an import tax benefit itself in the way of revenue while
it protects native industries (§ 2), and that a large section of a
community may be injured by free trade (§ 3) appear especially
masterly.

(5) Professor C. F. Bastable.—Professor Bastable’s ‘ attempt
to restate, in a more complete form, the doctrines of the classical
English school ’1 on International trade, has been attended with
a large measure of success. The classical or Ricardian method ad-
mits of completion on two opposite sides ; two contrasted
deficiencies may be attributed to it.2 On the one hand, it appears
not to go to the root of matters. It is as if an astronomer should
content himself with the proposition, ‘ Planets move in ellipses,’
without ascending to the first principles of dynamics. Such a one
might be at a loss when he comes to deal with certain comets.
On the other hand, the proposition that planets move in ellipses
might be a useless abstraction in a conceivable cosmos where the
existence of a disturbing medium caused the theory to lag very
much behind the fact.

It appears to me that Professor Bastable’s completion of the
classical method in the latter direction is quite complete. He has
fully learnt the lessons of caution which have been taught by his
great countrymen, Leslie and Ingram.. He never forgets that the
‘’hypotheses ’ of economics ‘ are unreal, or at all events incomplete.’
He has avoided the more dangerous extreme, the Charybdis of
over-abstraction.

But I am not so sure that he has kept clear of Scylla ;
and I shall attempt to indicate some instances in which deduc-
tion from first principles would lead to conclusions different
from his.

It is a little misleading to compare the trade between two
nations, supposed to be the only two in existence, to the ‘ terms
of an exchange between isolated individuals.’s The suggestion
that the terms are indeterminate in the former case in the same
sense as the latter appears to be theoretically indefensible. The
usual assumptions being made that there is a large number of
competing dealers on each side, the rate of exchange is to be
regarded as determinate in the international market as well as
in the home market. Accordingly, the analogy of monopoly

1 International Trade, Preface.

2 Some of the following sentences are taken from a review of Prof. Bastable’s
work by the present writer, which appeared in the
Academy for May 21, 1887.

3 International Trade, pp.' 14, 40, 41, &c. But see p. 28.



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