ipl-logo

The Pros And Cons Of Trade Liberalization

706 Words3 Pages

One of the uncontroversial issues of economic theory is that trade protection hurts the economy of the country that imposes. Hence, it is expected that the entry of many developing countries into the world market coincides with changes in both economic structure and rate of growth in these countries. Anne O. Krueger (2002) draws a conclusion that economic globalization conferred numerous advantages and among investments to improve current security environment is trade liberalization. In this essay, the large amount of information gathered from several developing countries regarding their exposure to globalization is presented to support the idea above in three aspects: economic growth, better living conditions and the decrease in unemployment rate, despite of negative effect on widening socio-economic inequalities within and between countries.
Above all, trade liberalization, a common component of globalization, absolutely leads to higher rate of economic growth, which is measured in three terms. The first benefit is the substantial increase in GDP. For example from the data of World Bank, between 1962 and 1989, South Korea 's GDP growth averaged over 8%, changing South Korea from a poor country into one of the G-20 major economies. Secondly, international exchange creates opportunities for developing countries in order to attract foreign investors and foreign capital. Michael D. Intriligator (2003, p.9) points out that foreign direct investment tends to increase at a much

Show More
Related

  • Pros And Cons Of Nafta For Canada

    576 Words  | 3 Pages

    The North American Free Trade Agreement, otherwise known as NAFTA, is an international trade agreement between Canada, Mexico, and the United States, designed to remove tariff barriers between all three nations. Signed in the January of 1994 with final implications made in 2008. This has created substantial economic growth for Canada and its other two counterparts. NAFTA has increased trade for the Canadians, and as a result has created lots of jobs for Canada. Overall, NAFTA has been extremely beneficial for Canada since it was established in 1994.

    Read More

  • Ledcs Face Along With The Advancement Of Globalization

    982 Words  | 4 Pages

    The development of free trade has become more controversial since the end of the Second World War due to rising openness to other countries and cultures. In terms of trade, globalization refers to 'as increasingly borderless trade that develops between countries and territories or countries and countries' (Archana, 2015). Along with the growing inter-connectedness of the world, the liberalization of trade policies has favored globalization amongst many countries and has led to an introduction of new agreements such as trade blocs in which several countries make an agreement to eliminate protectionist measures such as tariffs and quotas to facilitate the flow of goods and services. Easier transportation of goods and services across borders has reduced unnecessary costs which made the cost of goods themselves cheaper and more accessible. NAFTA is a good example of the situation where several countries agree to a partnership that makes imports and exports less costly.

    Read More

  • The Negative Effects Of The Triangular Trade

    628 Words  | 3 Pages

    During the 1600's there was massive amounts of trade between Europe, America and Africa called the Triangular trade or the Columbian exchange named after Columbus. The Triangular trade was influential for every single continent, even ones not involving Europe, America or Africa. This trade had positive and negative effects on all continents. Europe, Americas and Africa all experienced great economic and population growth. North America gained crops like coffee beans, sugarcane and livestock which caused their economy to grow.

    Read More

  • What Are The Pros And Cons Of Nafta

    700 Words  | 3 Pages

    The North American Free Trade Agreement has provided many benefits for North America. Because of NAFTA, trade, jobs, and economic growth have greatly increased between Mexico, the United States, and Canada. Along with these advantages many drawbacks can be found. One of the major issues concerning NAFTA is the agricultural competition between the United States and Mexico. NAFTA needs to address the conflicts that Mexican farmers are facing because a large portion of Mexican farmers are losing their jobs, making sacrifices, and stressing their lands causing environmental problems.

    Read More

  • Pros And Cons Of Trans-Pacific Partnership (TPP)

    863 Words  | 4 Pages

    Trans-Pacific Partnership (TPP) is a trade agreement between 12 influencing countries, which are United States, Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. Together, these countries make up 40% of the world's total GDP as well as 26% of the world trade, meaning that the pact will affect approximately 40% of the world’s economy. The agreement is believed to open markets, set high-standard trade rules, and address 21st century issues in the global economy. It includes 30 chapters regarding trade and trade-related issues, including trade in goods, e-commerce and telecommunications, intellectual property rights, and many more. The TPP itself has been negotiated 'secretly' for

    Read More

  • The Pros And Cons Of The Embargo Act

    344 Words  | 2 Pages

    A few years ago in 1807, congress had passed the Embargo Act, an act that forbids foreign trade. Today, a few years from that day in 1807 we look back on the preoccupations that have occurred because of the act. In just one year we saw our U.S exports decline by $84,000,000. We started with $109,000,000 and ended with $25,000,000.Thousands of Americans have turned to smuggling. The Embargo has trigger a serious Economic Depression and not much can save us right now.

    Read More

  • The Pros And Cons Of The World Trade Organization

    1735 Words  | 7 Pages

    Economic Global Governance WORLD TRADE ORGANIZATION: WHY IS IT BAD FOR YOU? Is The World Trade Organization really bad or is it because of the different perceptions of every individual regarding to the organization? Or is it really bad in its own nature? Well for me, I think the WTO is bad because of the different agreements that was set by them have many lapses in every agreements that has been done, there are also many issues that arises because there are some critics of the WTO, they argue that “subtle biases operate within the decision making structures that systematically favor developed countries over developing ones.

    Read More

  • Pros And Cons Of International Trade

    751 Words  | 4 Pages

    Introductions International trade refers to a country trade goods and services to another country. International trade open up the world potential market to increase producer sales quantity and increase competition on foreign country. apart from these, international trade will create job opportunity and hence reduced unemployment rate as well as positive balance of payment. however, it might bring negative effects to a country as well, therefore, government play an important role in implementing trade restriction on imported goods in order to prevent imported goods destroy the domestic market or at certain extend, monopolize the market. 94 words A ) Discuss the forms of restriction on international trade.

    Read More

  • Protectionism Essay

    2919 Words  | 12 Pages

    IF a common man is questioned “can protectionism ever be justified” he’d probably say NO, we live in a world of globalisation and there won’t be many who agree with the term protectionism is today’s day, its mostly considered as an “economic bad” . You will easily find governments who say ‘I am in favor of globalisation’ but rarely will u ever find a nation which says “we are for protectionism” and that’s probably the most basic difference between the two. Let’s start with understanding protectionism before we debate if it’s even justifiable or not? Protectionism may be defined as (Block, and McGee, 1997) ‘Any policy intended to shield domestic industries from import competition’ Protectionism is merely an attempt by a countries government

    Read More

  • The Pros And Cons Of Washington Consensus

    2326 Words  | 10 Pages

    The term “Washington Consensus” was created in 1989. It was first used in a background paper for a conference to examine the extent to which the old ideas of development economics (Williamson 2010). In order to ensure that it addresses the common set of issues, John Williamson made a list of ten policies that he thought the majority in Washington would agree were needed and labelled it the “Washington Consensus.” Williamson thinks that it would be a good policy to help the debtor countries overcome their debt burden with the changes in economic policy. 1.2

    Read More

  • The Pros And Cons Of International Trade

    1011 Words  | 5 Pages

    In the contemporary society, there are an increasing number of people involved in the globalisation. I choose the topic of international trade. And in the following paragraphs, I am going to introduce what is international trade, other possible benefits of trading globally and the bottom line. (Heakal 2015) Thanks to the international trade that allows us to expand the market for goods and services.

    Read More

  • Advantages And Disadvantages Of Global Trade And International Trade

    998 Words  | 4 Pages

    International trade is also knows as a globe trade which give the country opportunity to expands their markets for both good and services that otherwise may not have been available in other countries. This type of trade also give advantages for world to rise the economy in term of prices, supply and customer demands, affect and are affected by global events. All of the good and services can be found on international market. International trade will involve two types of process which be export and import. Export is a function of international trade in which the goods produced in a country will be sent to another country for future sale or trade.

    Read More

  • Advantages Of Multilateral Trade

    1446 Words  | 6 Pages

    QUESTION1 MULTILATERAL APPROACH TO INTERNATIONAL TRADE AS ADVOCATED BY THE WTO INTRODUCTION A multilateral approach is a treaty that refers to trade between numerous countries. It was the main activity associated with the 1947 GATT which took place during international conferences, whereby legislators came together to reject out and reach agreement on numerous trade issues. In total, there were 8 conferences under the former GATT. The first 6 of these conferences, ending with the Kennedy Round in 1967, concentrated mainly on tariff allowances.

    Read More

  • Disadvantages Of Globalization In Developing Countries

    805 Words  | 4 Pages

    First of all, the most obvious advantage that the globalization brings about is that goods (such as car, laptop, smartphone, etc.) produced in one country can be sold in other countries .For the developed countries, now the can easily export their products and services to other countries to earn money. And for the developing countries, it can create opportunities of employment and reduce poverty, which is very good for the economy. The next positive aspect which is taken into consideration is that the developing countries now can receive sources of capital, new technologies from developed countries, which is very essential for the growth of a country. And in return, the developing countries let the developed countries’ companies do business in their countries.

    Read More

  • Benefit Of Globalization In The Philippines

    945 Words  | 4 Pages

    As the saying goes, “there are two sides of a coin.” In the same way that globalization can be a boom for international trade; it can also have devastating effects. This essay highlights the benefits and adverse effects of globalization in the Pacific. It will also discuss how the government has adopted policies and trade agreements to keep up with the accelerated pace of globalization and how we the people of the pacific can deal with the biggest threat to our region which is “global warming” and its effects. Benefits of Globalization in the Pacific Free Trade Free trade is probably the biggest benefit that globalization has brought about.

    Read More

More about The Pros And Cons Of Trade Liberalization

Open Document