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Alexander Hamilton first codified the infant industry argument.. The infant industry argument is an economic rationale for trade protectionism. [1] The core of the argument is that nascent industries often do not have the economies of scale that their older competitors from other countries may have, and thus need to be protected until they can attain similar economies of scale.
Arguments for protectionism fall into the economic category (trade hurts the economy or groups in the economy) or into the moral category (the effects of trade might help the economy but have ill effects in other areas). A general argument against free trade is that it represents neocolonialism in disguise. [62]
Political poster by the British Liberal Party presenting their view of the differences between an economy based on free trade versus one based on protectionism. The free trade shop is shown as full of customers due to its low prices. The shop based on protectionism shows higher prices, a lesser selection of goods, and a lack of customers.
But it said global growth remained below the historical average of 3.7% from 2000-2019, and warned countries against unilateral measures such as tariffs, non-tariff barriers or subsidies that ...
Protectionism is the economic policy of restraining trade between states, through methods such as tariffs on imported goods, restrictive quotas, and a variety of other government regulations designed to discourage imports, and prevent foreign take-over of native markets and companies. The main emphasis of this policy is the protection of the ...
For example, banning high value-added manufacturing activities. Thus, the American Revolution was, to some extent, a war against this policy, in which the commercial elite of the colonies rebelled against being forced to play a lesser role in the emerging Atlantic economy.
A trade restriction is an artificial restriction on the trade of goods and/or services between two or more countries.It is the byproduct of protectionism.However, the term is controversial because what one part may see as a trade restriction another may see as a way to protect consumers from inferior, harmful or dangerous products.
Smith (2010) questioned the relevance of the Vietnam example, [28] and Griffiths later published a response. [5] Low prices may also occur because the fair trade marketing system provides more opportunities for corruption than the normal marketing system, and less possibility of, or incentive for, controlling it.