1;95;0c Mill's paradox - Devec
Open main menu

Devec β

Mill's paradox

In economics, the Mill's paradox is a classical proposition that asserts an inverse correlation between the size of a country and the magnitude of its gains from its trade.[1] The term was coined by Edgeworth (1899).[2] In John Stuart Mill's words, "The richest countries, caeteris paribus, gain the least by a given amount of foreign commerce: since, having a greater demand for commodities generally, they are likely to have a greater demand for foreign commodities, and thus modify the terms of interchange to their own disadvantage".[3]

John Somerset Chipman argues that the Mill's paradox is not a paradox at all; rather, it is another name for the Law of Demand.[4]