The benifits of free trade essay
A growing trade deficit, despite its misleading name, is good for the economy.
However, it appears there is a debate about the benefits and cost of the free trade. This led to mass unemployment in US.
The results are higher wages, investment in such things as infrastructure, and a more dynamic economy that continues to create new jobs and opportunities. Therefore, the importance of food security is to the general welfare of the population as a public health and nutrition benefit.
Hence, the trade is exploitive to the developing countries.
Advantages and disadvantages of free trade pdf
Trade liberalization led to development of these countries and to attainment of their current level of 'developed countries' in the world. Consequently, technology transfer has led to shift to manufacturing industries, which has attracted investors to the countries. Similarly, due to lack of tariffs and barriers to market, many industries are established in the developing countries resulting to losses of some of the industries due to competition and hence the industries move to other countries leaving a gap in employment in the previous country. For example, India has evidenced comparative advantage by employing labour intensive production skills in manufacturing and services that employs intensive skills as in software industries. Even under free trade, there can be emergence of natural monopolies or strong local or international cartels capable of restricting output and manipulating prices. If we do want to have a global feudal relationship, we need some rules to make it as fair as possible, and not believe in a non-sense of an unfair but absolute laissez-faire system. Concluding this critical analysis it is clear, that it is going to take decades to crystallise international trade policies that work for all. Nations are however the main element within a free trade agreement. How many companies starting from the 20th wealthiest country downwards has industries strong enough to compete on the global market. Restricting imports leaves Americans worse off. Policies that lift barriers on export and imports by lowering or elimination tariffs and duties encourage export and import of both goods and services to across the region.
Wedel in her book 'Shadow Elite: How the World's New Power Brokers Undermine Democracy, Government, and the Free Market' where she describes the cohesion of private and public and informal networks, that influence what governments actually do.
We make an assumption, that advantages within the economy are rather given than made.
Raynolds and Siphelo U.
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