Free Trade And Its Effects On The Prosperity Of Countries

Free trade is the concept of countries establishing an open, unrestricted market for imported and exported goods. Free trade between two or more nations is usually established through agreements such as NAFTA. The impacts and consequences of free trade vary wildly. Environmentally issues arise with free trade agreements as these agreements can strip away any country’s local environmental protection laws. Also, free trade can lead to destruction of habitats and forests (including rainforests) in order to create more things to export. Free trade also affects people, on a scale from an individual to an entire workforce of people.

The article expounds on two myths of free trade. The first myth is a theoretical argument which infers proponents encourage free trade to improve efficiencies and maximize prosperity. However, the author writes this myth covers the genuine intent which is to increase corporate

The question of whether the U.S. should adopt a free international trade policy is a hotly debated one. Currently, the U.S. has a relatively open trade policy and enjoys free trade with twenty countries1 and more are being added to this list through new agreements. But does it benefit from free trade? Evidence, which I will present in this paper, show that the benefits of free trade highly outweigh the little and often misinterpreted disadvantages. In light of this, the U.S. should adopt a free trade policy and look forward to new trade agreements.

Free trade has long be seen by economists as being essential in promoting effective use of natural resources, employment, reduction of poverty and diversity of products for consumers. But the concept of free trade has had many barriers to over come. Including government practices by developed countries, under public and corporate pressures, to protect domestic firms from cheap foreign products. But as history has shown us time and time again is that protectionist measures imposed by governments has almost always had negative effects on the local and world economies. These protectionist measures also hurt developing countries trying to inter into the international trade markets.

The purpose of a free trade is to promote the trade of goods between the countries within the agreement. Member of a free trade area do not have trade tariffs imposed on the goods that are traded between the countries. Additionally, members of a free trade agreement are able to create a comparative advantage by being able to produce products more efficiently specializing in developing the products that they are more effective at producing. By doing so, each country is able to increase their profitability due to their comparative advantages. “Comparative advantage suggests that trade is a positive-sum game in which all countries that participate realize economic gains. As such, this theory provides a strong rationale for encourages free trade” (Hill, 2015 pg. 168).

What is meant by free trade, exactly? First, it is important to note that while the terms “free trade” and “fair trade” are often used interchangeably in colloquial speech, they are completely different things. In fact, free trade is anything but fair (except to private corporate profits). Free trade, according to mainstream economic policy, has zero restrictions on imports and exports. There are no tariffs, quotas, subsidies, etc. Often, free trade agreements surpass the sovereignty of nations in order to guarantee the corporate interest in private capital gains. Michael Palenti, in his article, “Globalization and Democracy: Some Basics”, vocalizes this concern with free trade agreements, saying that, “…[corporations] seek a

Throughout the years, there has been a constant controversy over whether the World Trade Organization should enforce global free trade. The primary idea is to establish in which all are happy. Although there are many advocates for trade liberalization, as well as many who oppose. I believe free trade may be advantageous for both large and small-industrialized countries, but it does not favor the smaller developing countries needs primarily.

The economic benefits of free trade are very apparent in today’s society as globalization seems to be the direction we are heading. In the United States we only have about five percent of the world's population and with free trade we are allowed to freely trade to the other 95 percent of the people in the world. We can sell to anyone who is willing to make a trade agreement with us that is mutually beneficial. The next step to this process is “Once agreements move beyond the regional level, they usually need help. The World Trade Organization steps in at that point It is an international body that helps negotiate global trade agreements”(Balance). This is how making these agreements for free trade will benefit everybody.

According to its supporters, free trade policies allow countries to specialize in goods which they can naturally and efficiently produce. Countries generally try to be self-sufficient by using the resources they have to produce everything they need and the main reason behind this is to avoid the expenses of trade. However with trade becoming far cheaper due to the removal of barriers, each country that previously did this can now focus on what they need to produce and trade what they are not efficient at rather than wasting resources by producing everything possible. Furthermore, this not only means the resources are being put to better use but it also means that the country can trade at a lower cost due to the removal of barriers and can now put those finance’s into better use. Another advantage is that as time goes on and MNC’s set up in different countries, local firms have the opportunity to access some of the latest technology from some of the more developed countries of the world. Moreover, the world becomes a more competitive environment since MNC’s move and local firms have to match up to their par leading them to either gain from this exponentially as well as be able to grow in the near future to become a big firm in order to compete with the MNC or to join with them.

+ It creates employment opportunities. A clear advantage of free trade advocates point out is the need for more workers by the exporting country. With its market expanding globally, the demand for goods and services increase. Because of this, more labor force is necessary to ensure delivery and consequently, more jobs are available for the people.

As it can be clearly seen, this process is very wide-ranging which includes both economic and social results. However, in this study, it is aimed to deal with only trade which is quite controversial subject in terms of applied policy choices whether more liberal or more protectionist. For the purpose of this tariffs and quotas are chosen as an example of protectionist policies and Turkey is thought as case country in terms of membership of Customs Union. It will be argued that free trade policies may not seem to have destructive impacts on domestic markets of developing countries. On the contrary, this may help those countries to generate a stronger market thanks to

”Free trade policies have created a level of competition in today's open market that engenders continual innovation and leads to better products, better-paying jobs, new markets, and increased savings and investment” (Denise Froning). Though Free trade plays a huge role in the economy today because of what and where it is used. Free trade allows for traders to trade across national boundaries and other countries without government interference. Meaning that traders have very few regulations that allow for them to do this without the government intervening. Free trade makes things for traders much easier and also allows for many more jobs in the US, such as exporting jobs, or jobs in the auto industry and plants. Though there are many

Free trade is the idea of being able to trade freely with another country, with few barriers that are made by the World Trade Organization. This is a great strategy to be cost effective and be able to maximize whatever profits they may have; however companies do not realize the effect that they have on those who are less fortunate. For example, many jobs are taken from the countries that these companies are based in, the loss that local producers face can be quite severe when companies decide to move, and terrible factory conditions can make it difficult to work. These reasons make it not only the cost-effective strategy but the ethics of business are ruined and the impact it has on people that have to work with these constraints.

The benefits of international trade are really no different than domestic trade in the sense that it in its purest form is the voluntary exchange between individuals who seek the greatest value (or utility) of one good or service for another. What makes international trade different from domestic? Arbitrary political borders. International trade is merely the scaling up of competition and opportunity. As greater utility is achieved by increasing numbers of individuals, those individuals are able to specialize, maximizing their own native talents,

Free trade occurs when there are no artificial blockades put in place by governments to restrict the flow of goods and services between trading countries. When trade barriers, such as tariffs and subsidies are put in place, they protect domestic producers from international competition and redirect, rather than create trade flows. This results in less productivity and competition. Free Trade promotes international trade, multilateralism, and the development of lesser-developed nations and increases the standard of living. American opulence rests on the framework of global trade. Free trade guidelines have created a level of contest in today 's open market that produces persistent innovation and leads to better commodities, better-paying