Protectionism versus Free-Trad
The main objective of the following paper is to explain the protectionism versus free trade argument, to explain the problems this debate has created in the arena of international trade and to outline the ways in which international agreements have contributed to their resolve. Although many of the following issues are still present in the world economy today, they are constantly improving due to agreements such as the Uruguay Round and the North American Free Trade Agreement (NAFTA). Protectionism is easily related to the belief that a nation's resources need to be protected from international competition brought about by trade. Protectionist policies include trade restrictions which are of many natures. (See Appendix 1.A) Nations seek protectionist policy for various reasons such as: a source of government revenue,, to satisfy domestic interest groups and for the infant-industry argument among others. (See Appendix 1.B) The on-going debate regarding protectionist measures in the world economy seems to be an everlasting struggle.
Although there is some confusion to whether quotas are considered non-tariff barriers we will consider them as NTB's in any further discussion. Quotas are the first NTB we will discuss as they are considered the most important NTB in the present World Market. By definition, a quota is a quantitative limit placed on the import of a commodity. The protection offered by a quota holds more certainty than that of a tariff. Because tariffs depend on the price elasticity of the commodity it is very difficult to predict extra costs. Thirdly are technical and administrative regulations such as safety and health regulations and labelling requirements on imported commodities. Tariffs are additional costs, such as taxes, that are added to a commodity as it either enters or leaves a nation. Import tariffs will be the type of tariff discussed in this paper. Tariffs can be calculated in the following three manners: the ad valorem tariff which is calculated by a fixed percentage of the estimated market value of the good, the specific tariff whi
Some common words found in the essay are:
Tariffs Tariffs, VERs NTBs, NAFTA Protectionism, Price Discrimination, , World Market, Morse Wooster, Countries Dumping, Organization WTO, Barriers NTB's, ntb examine, tariff calculated fixed, tariff calculated, calculated fixed, price charged, dumping behaviours, free trade, non-tariff barriers, international cartels, world economy,
Approximate Word count = 704
Approximate Pages = 3 (250 words per page double spaced)
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