Lessons From the Recession: Lesson 7—Integrative Trade Can Pull Us Down and Up

While international trade helped pull Canada and the world into recession, deep global linkages may have helped to blunt the protectionist response and can help to better position the Canadian and global economies coming out of the global slowdown. Lesson 7: Integrative Trade Can Both Pull Us Down and Pull Us Back Up argues that “integrative trade”—or the use of global supply chains—likely pulled Canada and the world more deeply into recession than would have otherwise been the case. But while protectionism has clearly risen in the wake of the recession, deep global linkages may have limited its scope. Expanded integrative trade can help drive the recovery, providing that policy makers resist protectionist impulses and adopt policies in line with the realities of today’s globally integrated production.