Compensating globalization’s losers, redux


Echoing Julian Sanchez’s argument against compensating globalization’s losers, Alex Tabarrok writes:

Imagine that transportation costs fall so that Joe buys his shoes from China. Why do lower transportation costs impose an obligation on Joe to compensate Mary, a U.S. shoe maker? If transportation costs rise (say because the price of oil increases) does Mary have an obligation to compensate Joe?…

Of course, I understand that we might have to compensate the losers from globalization because without compensation they won’t allow us to trade… It might be expedient… but is this justice?


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