Frederic Bastiat Flashcards
What was the July Revolution?
1830 - The fall of the Napoleonic Empire and the redrawing of continental Europe by the Vienna Congress left France in domestic disarray. This triggered a second act of the French Revolution. Along with other political reforms, it notably created a constitutional monarchy and changed the principle of hereditary right to popular sovereignty.
Why does Bastiat argue for free trade?
Using the concepts of actual and comparative advantage, Bastiat aims to show how trade with more efficient foreign industries will be better for domestic consumers
How does Bastiat’s methodology assist his argument?
Bastiat used humour by labelling the ‘sun’ as the candlemaker’s rival to draw extreme conclusions and enhance his argument
The sun produces light more efficiently than artificial light
Where does Bastiat place the consumer in the debate over protectionism?
Bastiat placed the consumer at the centre of his argument and challenged the notion that consumers and producers mutually benefited from protectionism
Classical thinkers, such as Smith and Ricardo, heavily influenced his support for free trade by focusing on the negative effects of protectionism on consumer prices
What is the critical economic concept that Bastiat introduces?
Opportunity Cost - or, the ‘gratuitous gift’
How does Bastiat see the function of opportunity cost?
Bastiat introduces the concept of Opportunity Cost through the ‘gratuitous gifts’ of foreign industries
Imports are able to meet particular demands of consumers at a lower cost
It also allows domestic industry to prioritise sectors most suited to its environment and resources
Connected to Smith’s conception of the Business Cycle – Markets/Producers will naturally adapt to what is most practical and efficient for their own interests (individually and collectively
What was the French Liberal school?
Bastiat was a key member of the French School, which heavily promoted free trade and laissez-faire. They were primary opponents of interventionist and protectionist policies. An important influence of the school on Bastiat was the work of Jean-Baptise Say.
How did Bastiat influence the Austrian school?
Bastiat was considered a forerunner of the Austrian School, which emphasised the role of the individual and marginalism in economic study. The school was directly opposed to the German Historical School and was heavily influenced by the French Liberal School. Some notable members included such as Carl Menger
