Healthy Trade: The Relationship Between Open Trade and Health

Published date01 February 2013
AuthorPhilip Stevens,Gabrielle Wills,Jasson Urbach
Date01 February 2013
Subject MatterArticles
Healthy Trade: The
Relationship Between
Open Trade and Health
Philip Stevens
Jasson Urbach
Gabrielle Wills
A recurrent theme of the academic literature and wider public discourse is that
free trade is bad for health as it promotes economic inequality and insecurity,
polluting the environment and making processed foods more widely available.
Such views are also widely promulgated by international policymaking organiza-
tions such as the World Health Organisation (WHO).
However, there has been little empirical evidence to support these assertions,
in particular the relationship between free trade and health. This is an important
relationship, as it tells us more about the effect of economic policies on human
welfare than bald statistics relating to GDP.
This study aims to build on a nascent literature by examining the relationship
between free trade and health, using a range of data relating to trade openness
and human development. Our analysis finds that free trade does in fact appear
to be associated with better health outcomes, with the relationship particularly
pronounced for lower-income countries.
There are two mechanisms that might be responsible for this relationship.
On the one hand, trade promotes economic growth, which in turn provides
greater sums for individuals to improve their living conditions and for authorities
to spend on public health measures such as sanitation and universal vaccina-
tion. Another mechanism is ‘knowledge spillover’, wherein international trade
increases the global diffusion of both knowledge and products that improve
health—ranging from the basics of germ theory to modern pharmaceuticals and
medical devices.
JEL: F10, O15, I10, I11, I18
Foreign Trade Review
48(1) 125–135
©2013 Indian Institute of
Foreign Trade
SAGE Publications
Los Angeles, London,
New Delhi, Singapore,
Washington DC
DOI: 10.1177/001573251204800106
Philip Stevens, Executive Director, Emerging Markets Health Network, Kuala Lumpur,
Malaysia. Email:
Jasson Urbach, Research Fellow, Free Market Foundation of Southern Africa,
Johannesburg, South Africa.
Gabrielle Wills, Independent researcher and economist, Johannesburg, South Africa.

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