New features, forgotten costs and counterfactual gains of the international trading system

In this paper, we critically survey the literature dealing with some of the significant changes that have recently occurred in international trade flows and policies. The aim is to offer a ‘road map’ through large swathes of literature and inform the profession of recent developments in terms of new data and methodologies that can assist us as we seek to analyse agricultural markets and policies. In the first part, we analyse - both from a positive and normative point of view - the increasing importance of global value chains and highlight the systemic structure of trade relations. In the second part, we run through the most recent literature that assesses the impacts of trade liberalization. On the one hand, increasing attention has been paid to the trade adjustment costs underlying the current discontent with trade liberalization; on the other, the new (new) trade theory has provided valuable insights in order to better estimate gains from trade.