Analysis Of Employment Rationale For Trade Protection
Since ABC International Ltd is planning to increase its international trade activities, it will be useful to understand the basis of public policy about international trade. A critical review of the chapter 3, titled Employment Rationale for Trade Protection by Douglas Irwin in his book “Free Trade Under Fire” would be very helpful (Irwin, 2002).
Irwin explains how free trade does not cause adverse impacts on employment, which is one of the main arguments put forward by the opponents of free trade. He agrees that some jobs are lost due to increase in imports but new jobs are created in other sectors of the economy. He argues that trade deficit does not have direct adverse impacts on the employment because the balance of payment account is …show more content…
Some consider free international trade as exploitation of developing countries while other consider it as transferring jobs from the importing country to overseas. Even the leading economists disagree on whether or not the benefits of free international trade outweigh the potential adverse impacts. Each country tries to design its trade policies to the best of its advantage and directly or indirectly impose some restrictions. The World Trade Organisation has been established to support free trade and remove barriers. Still the protectionist mind-set pops-up and tries to influence the trade policies under one or another pretext. The chapter 3, titled Employment Rationale for Trade Protection by Douglas Irwin in his book “Free Trade Under Fire” is a good example to clarify the doubts (Irwin, …show more content…
They use it to exploit the workers’ sentiments and gain political support. However, the serious public policy has supported the free trade in the past and would continue to do so, as is evident from the recent initiative by President Obama to introduce new free trade agreements for Trans-Pacific countries (Reuters, 2014). As such, we should do not expect any protectionist policies in the future against our plan to increase international trade activities. This would certainly help expand the business of ABC International
Irwin explains how free trade does not cause adverse impacts on employment, which is one of the main arguments put forward by the opponents of free trade. He agrees that some jobs are lost due to increase in imports but new jobs are created in other sectors of the economy. He argues that trade deficit does not have direct adverse impacts on the employment because the balance of payment account is …show more content…
Some consider free international trade as exploitation of developing countries while other consider it as transferring jobs from the importing country to overseas. Even the leading economists disagree on whether or not the benefits of free international trade outweigh the potential adverse impacts. Each country tries to design its trade policies to the best of its advantage and directly or indirectly impose some restrictions. The World Trade Organisation has been established to support free trade and remove barriers. Still the protectionist mind-set pops-up and tries to influence the trade policies under one or another pretext. The chapter 3, titled Employment Rationale for Trade Protection by Douglas Irwin in his book “Free Trade Under Fire” is a good example to clarify the doubts (Irwin, …show more content…
They use it to exploit the workers’ sentiments and gain political support. However, the serious public policy has supported the free trade in the past and would continue to do so, as is evident from the recent initiative by President Obama to introduce new free trade agreements for Trans-Pacific countries (Reuters, 2014). As such, we should do not expect any protectionist policies in the future against our plan to increase international trade activities. This would certainly help expand the business of ABC International