Cultural Values
The debate about increasing protectionism in the U.S. boils down to a clash of cultural values. In the natural course of international trade, there will be those who suffer and those who benefit. International markets are amoral. Trade is conducted between nations with the intent of raising the standard of living for both, but this is on aggregate, not universally. As a result, jobs losses in some sectors, particularly those where the U.S. does not have comparative advantage, are inevitable. To enact protectionist measures to stem those job losses will have three negative impacts.
The first is retaliatory trade measures. Tariffs and other protectionist measures tend to go hand in hand. If a country protects its industries, nations that trade with that country will do the same. This is the classic Smoot-Hawley scenario. To protect American jobs during the Depression, the Smooth-Hawley Act was signed, bringing heavy tariffs to protect U.S. workers. However, the major trading partners in Canada and Europe retaliated against these measures by protecting their markets from American goods. The impacts on the U.S. economy were devastating, as export markets disappeared overnight and domestic consumption remained unstimulated (U.S. Department of State, no date).
The second impact of protectionism is that it represents a distortion in the markets. If the free market determines that those jobs are no longer sustainable, protectionism will not change that. The cost of sustaining those jobs will simply get higher, as those jobs become increasingly unsustainable. Distorting markets creates inefficiencies and the potential for market failure. By contrast, the removal of trade barriers promotes market efficiency.
The third impact of protectionism is that it breeds complacency. Industries that are protected have little incentive to compete better. They innovate at a slower pace,...
Advanced Biomedical Devices: International ExpansionCountries selected for exportingExporting is faced with many restrictions from the countries and the regional trade bodies that regulate the export of goods and services. Many countries have adopted export restrictions, with the United States, China, and the European Union still implementing the export restrictions. Australia, Canada, Western Europe, and Japan will be the nation�s chosen for export. They have such a sizable number of affluent
Companies such as XYZ Widget Corporation are well situated to take advantage of burgeoning markets in developing nations, particularly in Asia and Africa. 2. XYZ can grow its business by expanding its operations to certain developing nations in ways that profit the company as well as the impoverished regions that are involved, particularly when marketing efforts are coordinated with nongovernmental organizations operating in the region. 3. Several constraints and challenges must
Manufacturing Industry in Australia The question that is being studied here is of unemployment, and this is clearly not being lost because of imports. The calculations have been made by the Australian Center for Industrial Relations Research and Teaching, and they say facts about the net changes in the rate of employment between 1988 and 1998 in a number of industrial sectors. It can be seen that there is a clear
Costa Coffee: An Overview What market is it in? As one of the premium espresso chains in the United Kingdom, with a price point higher than that of Starbucks or standard pub coffee, Costa Coffee is clearly focused in its efforts toward the consumer market.[footnoteRef:1] It primarily sells coffee and accompanying sandwiches and beverages. It also sells beans and other coffee products to consumers, but these aspects of its trade are a
Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
Get Started Now