Free Trade : More Competitive Domestic Markets

The concept of free trade has been debated throughout the ages and continues to stir emotion, as the title of Douglas Irwin’s book: Free Trade Under Fire. Douglas A. Irwin (born in 1962) is not only a businessman, but also is an American economist. But compared to other economists, he is exception stood out with clear and jargon-free English writing style. And in this book, Irwin has provided an informative, comprehensive and easy-to-read explanation of the benefits of a liberal international trading, help people who are deceived of the accusations against open markets have more information and knowledge to evaluate the issue more precise.

Economist have been debating between free trade and protectionism for decades. This debate has been most recently reiterated through President Donald Trump’s announcement that his administration would be taking steps to limit free trade in the United States. The opinion piece “Beware the Trump Trade Trap” by Liz Mair, argues that free trade is positively linked to a country’s prosperity, although most of the population may disagree with this. Mair argues that protectionism would limit consumption, however, it is important to also expand upon these ideas and to remember that free trade encourages prosperity, comparative advantage, and improves economic growth.

From an economic point of view, we cannot support this hypothesis. Free trade allows nations and companies to specialize themselves in producing goods in which they have a comparative advantage over others. Other goods, in which a nation lacks in efficiency, should better be imported than domestically produced. This specialization helps to further improve productivity, reduce the prices for products and hence, increases the overall live quality of the citizens.

Free trade provides opportunity, it provides growth, and it provides struggling nations a chance. With free trade, markets open across national borders and the consumer ultimately benefits from higher quality goods at fair market prices. The producers of such goods now have larger markets to sell to allowing for the opportunity at increased sales, giving the consumer a greater variety of goods that can more individually meet specific demands. Free trade implementation to the United States foreign policy is a developing and revolutionary mindset that will bring prosperity to all parties involved. The United States will benefit from free trade because the market to purchase U.S. made goods and services will increase dramatically

Free trade is an important economic policy that has been brought to the forefront of debate. Arguments have varied from the potential harm it brings to specific groups of people, to the idea that free trade is extremely beneficial in the increasing of competition and improving the nationwide economy. Free trade is a policy that practices removing restrictions such as tariffs, taxes, and bans, allowing for free participation among all kinds of economies and producers. In other words, free trade is a way to “break down” economic barriers. Comparative advantage is a term often used to support the policy of free trade. The theory of comparative advantage displays that if trading partners produce where there is the lowest opportunity cost, then

While free trade could potentially mean a lot of benefits, its superiority over protectionism is strictly theoretical, under the conditions that you disregard all the unique conditions of each country involved, and the possibility of exploitation of workers, resources and legal loopholes by large corporations. Realistically industries will be monopolized by whichever country that does it cheapest, thus making any competition in that industry from the other countries extremely unprofitable and unsustainable. Each country would only be able to focus on sectors that they have a comparative advantage in, while the other industries would stagnate, laying off masses of workers, causing high unemployment rates in the country. Furthermore, businesses are focused on their own profit so they’ll go for labour wherever it’s cheapest, which increases income disparity. Theoretically, free trade can bring about the largest amount of trade and aggregate wealth for everyone by making each country specialize in what it has an advantage in, to produce more for less, lowering the market prices to be more affordable, greatly boosting trade, and raising quality of life. Essentially free trade aims to maximize income for each country under the contemporary conditions. However even if everything miraculously goes as planned and that hypothetical situation is reached, even under these perfect conditions free trade will allow no further development of industry.

The idea of Globalization is a term utilized to highlight the integration of the world’s economies. Globalization has been sold as a primarily positive idea for its facilitation of trade amongst countries who previously had little or no economic or diplomatic ties. However, these international agreements are contingent on policies which removes regulations on businesses both domestically and abroad. Considering nations want to incentivize potential businesses to enter their respective countries, they seek to eliminate regulations, ignoring the laws that could protect their very own citizens and country. Therefore, as globalization seeks to enrich certain parts of the planet, it does so as the expense of another sector.

Problem: Working class Americans experience difficulties in finding work as labor intensive jobs are moved abroad. At the same time free trade is beneficial for the global economy as a whole. Here we can see a clash in interests as the interests of those in developing countries are protected as well by the WTO and free trade tends to be beneficial for the economy as a whole. However, the problem is that 20% of the prime male working population between the ages of 25-54 are unemployed and this number is around 35% of those who don’t have a high school diploma. For marginalized groups such as African American males the teen unemployment is over 40% and that of young black men from the ages of 16-24 is over 30%.

One of the greatest international economic debates of all time has been the issue of free trade versus protectionism. Proponents of free trade believe in opening the global market, with as few restrictions on trade as possible. Proponents of protectionism believe in concentrating on the welfare of the domestic economy by limiting the open-market policy of the United States. However, what effects does this policy have for the international market and the other respective countries in this market? The question is not as complex as it may seem. Both sides have strong opinions representing their respective viewpoints, and even the population of the United States is divided when it comes to taking a stand in

Philip Hammond once said, “When I believe firmly in open markets and free trade, I also believe an open market needs a level playing field.” This would express the definition of free trade, the international trade left to its own course without tariffs, quotas, and other restrictions. However, this definition is a myth. Free trade is not as free as it is meant to be believed. Free trade extends to the relationship of Europe and the United States. With that being said, free trade has turned into a dependence upon the United States as Europe has no other source to turn to or gain necessary means for profit. So, the United States is able to abandon Europe, but Europe cannot lift the oppression of tariffs. By definition, the free market should be determined by supply and demand, and consumers than restrictions and interventions. This does not seem to be the case in the relationship between these two nations. Today, free trade agreement lends itself to the free movement of the superpower while Europe has limitations. This free trade is known as the Transatlantic Trade Investment Partnership. The United States and Europe trade is for the “mutual” benefit of job creation,economic growth, and international competitiveness. However, this trade agreement is only beneficial to one party, the United States. This law allows a foreign company who invests in a foreign country to sue the nation if the country makes changes to the agreement. Therefore, Europe will always be in debt to the

On January 23, 2017, Trump fulfilled his campaign promise by pulling America out of the Trans-Pacific Partnership, which is a free trade agreement between the US and 11 other Pacific Rim states reached under the Obama administration. Trump stated that he did a "great thing for the American worker." (Bradner) When Trump was on the presidential campaign trail, 54% of Americans answered “much more likely” or “somewhat more likely” to the question "would you be more likely or less likely to vote for a candidate for President who promises to put a stop to the Trans-Pacific Partnership, and enact trade policies that put U.S. jobs first" in the Caddell & Associates poll conducted from February to March 2016. (Ballotpedia) Nevertheless, in the

”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

The emerging trend of liberalizing international trade regulations, also known as globalization, has lead to vast changes in distribution of wealth and power throughout the world. As a result, many groups and population segments feel pressured or disadvantaged by the evolving structure of world markets and their effects on labor standards, job availability, environmental standards, etc.

Protectionism is an extremely debatable topic among international trade. Marketplaces exist because of competition; thus, trade is vital to consumers. Free trade, where international trade is left alone – without any restrictions (i.e. tariffs and quotas), allows for consumer choice to flourish as there is a large variety of products to choose from and consume. Most importantly, free trade allows consumers to consume at lower prices. However, with protectionism, free trade does not exist (Sanders). Although free trade does not exist, trade among countries still exist. As product trades are beneficial to consumers, they may be detrimental to producers. Therefore, countries impose tariffs and quotas on foreign products to protect domestic industries and businesses. Along with protecting domestic industries, tariffs and quotas prevent trade dumping.

As we know trading blocks are breaking down into several different union, and different countries gather up in order to make trade intensely with each other. But that is just a brief definition, because the intense trades could as reflect no more than variable in comparative advantage. According to, “ What mainly matters is that each of these agreements allows trade between the participating countries to take place more easily and at lower cost.”(Economic theory and policy for trading blocks, 1994).