Free trade raises people's incomes, improves lives

Supporting free trade is out of fashion. In rich countries, it has been blamed for job losses and all but abandoned by policymakers. Over the past century, trade had been increasing as a percentage of the global economy, but this peaked around the global financial crisis, and is now declining. This is even true for China, where the share of trade in GDP has dropped.

It has been known for centuries that trade lifts people's incomes because it allows a country to specialize and produce effectively what it does best. One study finds that trade makes us all 27 percent richer, meaning that countries on average have incomes more than one-fourth higher compared with a world without trade.

Trade doesn't just lift average incomes. It also helps lift the world's poor out of abject poverty. One of the most cited recent studies finds that the incomes of the poorest 20 percent grow as fast as the average.