Free Trade and Intermediary Conditions

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Ha Joon Chang is an author everyone should read. He cuts through some of the idealisations in sternly paradigmatic economics. Reality comes up with what I call “intermediary conditions”, and that is what Chang is writing about: the conditions that actually prevail in real life.

See more at The Paradox of Freedom (1) - Austrian Thought and the Crisis of Liberalism

The Wankel rotary engine works perfectly on the level of paradigmatic theory; but reality adds lots of obstacles on a project's way to fruition.

There is something akin to an uncertainty principle involved in much of economics: you either get a neat theory but miss reality (as in the theory of free trade) in the measure in which your theory is well-rounded or even complete, or you get closer to reality but theoretic completeness diminishes.

The great sin of almost all economists is that they do not pay attention to this uncertainty principle, but prefer seeking the comfort or honour of belonging to a camp devoted to a neat theory.

From a comment I left with Nick Johnson, from whose blog I take the below short yet substantial vid: