Is Protectionism Ever Justified

6199 Words25 Pages
Is Protectionism ever justified? Explain with examples.

Ria Rajendra

C11IB (International business management)
Dr. UmmeSalma Mujtaba
October 29, 2013
a. Introduction
b. Arguments for protectionism
i. Infant industries ii. Free Trade iii. Anti- dumping iv. Environmental factors
v. Employment opportunities and the concept of balance of payments disequilibrium vi. Cultural influences
c. Protectionism vs. Free Trade
d. An analysis based on % news articles from, The Economist
i. Appendix.1 ii. Appendix.2 iii. Appendix.3 iv. Appendix.4
v. Appendix.5
e. Conclusion

Is Protectionism ever justified? Explain with examples.
a. Introduction
Protectionism is said to be a “Government’s actions and policies that
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(Regine, 2012) iii. Anti-dumping
Now finally we can see the dynamics between protectionism and the concept of Anti-dumping. “Dumping, the practice of selling goods in foreign markets at lower prices than you charge for them in your home market is the protectionists ' favorite bogeyman.”(The Wall Street Journal, 2007).For e.g.: The EU sold a lot of its excess food produce from the common agricultural policy to the world market for very low rates. This in turn affected the farmers in other parts of the world as that changed the market prices and reduced it drastically. (Regine, 2012)So we can see here how dumping affects countries. Generally a nation supports anti- dumping as it wants to protect its domestic industries and hence anti- dumping can be looked at as a protectionist measure. (World Trade Organization, 2013) iv. Environmental factors
In terms of environment free trade is frowned upon because that leads to the least developed countries using up all the raw materials to export which results in harming the environment. Another aspect here is the pollution and in terms of this nations with strict pollution regulations will have consumers willing to import from nations with a more lenient pollution regulation or a nation where there isn’t a pollution regulation. (Regine, 2012) What is happening here is say a foreign industry produces goods in its own country with less
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