The Role Of The International Trade Environment On A Free Market Type Environment Versus One With Heavy Government Regulations Essay

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Government plays and integral role in ensuring that developing countries have a fair and sustainable share of the benefits of the international trade environment. There is a large contrast between a system operating in a free market type environment versus one with heavy government regulations and intervention. It is important to examine industrial policy, strategic trade policy, trade problems facing developing nations, import substitution and export-led growth.
Government Role in Developing Countries with Regard to International Trade
Developing countries is a term that has been used loosely and can be formally defined as any country with limited economic resources and a very poor standard of living. Since the 1960’s, international trade has changed quite a bit and has come to influence global economic concepts. The role of government intervention has taken a turn in less developed countries and is moving toward the partial transfer of control and ownership, adding value domestically, bringing more host nationals into the equation to enhance the buy-in to domestic benefits. “Markets need sure and stable government laws and policies in order to properly price assets (Miller, Terry, 2009).” It can be said that an increase in regulation could lead to a decrease in financial and credit markets and a reduction of available credit to individuals and business with an increase cost. Any policies that squash the flow of goods and services internationally have a most negative

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