Abstract: Adam Smith (1776) is generally ignored as an international trade theorist in textbooks and surveys because of the common belief that he only confirmed the rule of absolute advantages to explain structure of foreign trade. On the other hand, many textbooks and surveys on growth theories simply overlook Smith's significant contributions to economic growth theory. Smith’s insights can still be relevant today and what can be learnt from the mistreatment Smith has suffered in the historiography of international trade theory.
However, his vent-for-surplus approach may be interpreted as a pioneering study which stresses the importance of economies-of-scale in explaining the structure of foreign trade. Furthermore, in Smith, both learning by doing and economies-of-scale are crucial to explain long-run economic growth.
This paper addresses to the undeniable influence of Smith's concepts on the promotion of quality labour that increases the productivity of the nation and causes an increase in the international trade of the nation leading to the integration of economies.
Keywords: Doxography, International Trade, Constant Returns to Scale (CRS).
Title: Adam Smith on Foreign Trade: The Underlying Theory and Doxography
Author: Prof. K Vijayaraj, Naveen Rai
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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