¶ … conflict theory and functionalism in a sociological context, I have chosen world trade as the topic, mainly the way developing and poorer countries and developed economies evolve and act in the world trade arena.
Conflict theory seems perhaps better suited to explain the contradictions in world trade and, even more profound, the differences that normally appear between developed and developing countries, especially in World Trade Organizations Ministerial Conferences, but also in general trade relations.
The tools and general trends that world trade operates with are liberalization and protectionism (protective measures). High import taxes and subsidies are among the most common protective measures and these have the role of protecting national producers against lower priced, more competitive products that may enter the country and may force the national producers into bankruptcy.
The industrialized countries generally aim at imposing global lower import taxes on manufactured goods. This would ensure them better export capabilities to third world countries, given the fact that manufactured goods from developed countries are generally more competitive, because of higher prices. So, the only chance for national manufactured goods from third world countries would be a price advantage over Western goods.
However, the price advantage is driven by the price level at which these goods are sold. The lower the import taxes, the lower the price that Western goods will be commercialized at and, as such, the lower the price advantage for manufactured goods n developing countries.
The agricultural products are somewhat in a different situation. Many developing countries produce much cheaper goods, but this would tend to suffocate national producers in United States and the European Union, for example, because they would not be able to compete with cheaper grains, fruits, etc. As such, developed countries use either import taxes or export subsidies that will allow for lower price for the producers at which they will sell and will thus protect national farmers by ensuring they stay in business. Over these two different sides of the problem conflict appear and conflict theory best explains this.
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