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Defend or refute the following argument-Free trade is more advantageous for any economy.
On Jul 22, 2024
Answers will vary. For centuries, business leaders, scholars, and governments have argued for and against international free trade. Today, international free trade in a competitive marketplace is widely accepted as the most efficient and beneficial form of trade for any given nation's economy. Several recent studies found that free-trade policies cause long-term economic growth and that this relationship is reciprocal, meaning that growth increases freer trade which increases growth.
Governments have many different reasons to pursue free trade, but they also have reasons to deliberately restrict trade.
-A government may forbid a politically sensitive industry (like defense contracting) to export certain products or technologies, or it may erect barriers to competition around a particularly important domestic industry threatened by global competition. These barriers can reduce the importation of foreign goods and services or eliminate the exportation of domestic goods and services.
-Another reason a government may seek to limit trade is to protect its "infant industries."
-Countries may erect trade barriers is to adjust the balance of trade. A country or multinational organization may aim to restrict trade as a bargaining tool. The United Nations frequently uses trade sanctions or limitations on trade against countries in an effort to change those countries' behaviors.
-A country may introduce trade protections if it feels a trade partner is engaging in "dumping," or selling goods below the cost of production.
The sections "Patterns of Trade: Increased Regionalization" and "Government Policies Directed at Trade" on pages121 and 126, respectively, discuss the pros and cons of free trade. Students can use this section to make their own interpretation and answer this question.