Please try to explain why under certain circumstances, government interventions are better than doing nothing? You need to answer this question step by step like the following: (1) Why are we living in a second-best real world? What are the differences between the second-best reality and first-best world? (2) Why do we say that in the second-best reality, free trade may result in deadweight losses? (3) Please use a diagram to explain when does government should protect domestic production or employment? (4) Please further explain whether tariff is the best policy to protect domestic production and employment? If mot, what is the better policy? And why is there better policy than tariff?

Please try to explain why under certain circumstances, government interventions are better than doing nothing? You need to answer this question step by step like the following: (1) Why are we living in a second-best real world? What are the differences between the second-best reality and first-best world? (2) Why do we say that in the second-best reality, free trade may result in deadweight losses? (3) Please use a diagram to explain when does government should protect domestic production or employment? (4) Please further explain whether tariff is the best policy to protect domestic production and employment? If mot, what is the better policy? And why is there better policy than tariff?

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter22: Economies In Transition

Section: Chapter Questions

Problem 13SQ

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