Academic research supports the view that import competition has led U.S. manufacturing firms to become more capital intensive;7 trade liberalization apparently has enhanced productivity in some import-competing firms in foreign countries as well.8 Producing for export markets may also yield dividends: Research suggests that exporters are more productive than non-exporters in the same industry and that they grow more rapidly as well.9 Finally, many studies suggest that countries that are more open to international trade have enjoyed higher rates of economic growth.10 Our sad experience after adoption of the Smoot-Hawley tariff of 1930, as well as the record of Latin America, India, and other regions that experimented with “import-substituting industrialization,” point to the deterioration in economic performance that occurs when countries erect barriers to trade.11  Arguments against free trade If the benefits conferred by international trade are reasonably straightforward, how can we explain the apparent ambivalence toward trade picked up by recent surveys?
This situation is contrary to what is generally happening in advanced countries, where every building and every piece of land is legally documented, which essentially activates that asset as a resource to potentially participate in economic activities.