The strategic trade policy arguments of the new trade theorists challenge the rationale for unrestricted free trade found in the work of classic trade theorists.In response to this challenge to economic orthodoxy,a number of economists-including some of those responsible for the development of the new trade theory,such as Paul Krugman are:

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The strategic trade policy arguments of the new trade theorists suggest an economic justification for government intervention in international trade,thus challenging the rationale for unrestricted free trade found in the work of classic trade theorists such as Adam Smith and David Ricardo.In response to this challenge to economic orthodoxy,a number of economists-including some of those responsible for the development of the new trade theory,such as Paul Krugman-point out that although strategic trade policy looks appealing in theory,in practice it may be unworkable.This response to the strategic trade policy argument constitutes the revised case for free trade.

The Strategic Trade Policy Arguments of the New Trade Theorists