Free trade theory, dating to Ricardo, argues that countries benefit by specializing in goods they produce most efficiently and trading with others. Critics note that historical industrialization contradicts this: nations like the US, Germany, and Japan used tariffs to protect infant industries before becoming global competitors. Ha-Joon Chang argues developing countries are now being told to follow free-trade rules that rich nations violated during their own development—'kicking away the ladder.'
The passage suggests that
there may be tension between economic theory and historical economic development patterns
all developed nations fully followed free trade principles during industrialization
free trade theory is the only economic perspective that exists
tariffs have never been used by any nation
Correct Answer: A
Choice A is the best answer. Theory recommends free trade; history shows protection during development.
- Context clues: Free trade theory vs. historical use of tariffs for industrialization.
- Meaning: What theory prescribes differs from what actually occurred.
- Verify: "Kicking away the ladder" imagery captures the theory-practice tension.
💡 Strategy: When historical evidence contradicts theoretical prescriptions, infer tension.
Choice B is incorrect because the US, Germany, Japan used tariffs during development. Choice C is incorrect because critics and Chang present alternative views. Choice D is incorrect because tariffs were used for "infant industries."