Final answer:
Trade gains at the free market equilibrium can reach hundreds of billions to trillions of dollars annually and include recurring and unmeasured benefits in variety, competition, and knowledge transfer.
Step-by-step explanation:
The total gains from trade at the free market equilibrium are substantial, often measured in hundreds of billions of dollars annually and possibly extending to trillions. These gains are particularly significant as they recur each year, indicating their long-term benefits to the economy. Additionally, there are unmeasured gains from trade that may not be captured by standard economic statistics, such as consumer benefits from variety and competition, and the transfer of knowledge across borders in areas such as production, technology, management, finance, and law. The potential for trade gains is notably pronounced in smaller and lower-income countries, where it can highly impact economic growth.
References supporting these assertions include M.J. Melitz and D. Trefler's work 'Gains from Trade when Firms Matter' published in The Journal of Economic Perspectives.