Pages in this set

Page 1

Preview of page 1
Harry Bindloss




BARRIERS AND PROTECTION
Protectionism: The intervention by governments in the free trade between nations. The
methods available usually attempt to reduce imports (to protect domestic production) and
are therefore often referred to as trade barriers, although other methods may seek to
encourage exports.



Tariffs: Taxes levied by the…

Page 2

Preview of page 2
Harry Bindloss




Due to imports being more expensive, consumers will switch to local goods and therefore
there will be more jobs. However it goes directly against the law of comparative advantage.
This is because the outside goods may actually be cheaper. This can delay or prevent
structural change. If you…

Page 3

Preview of page 3
Harry Bindloss




We want to control the amount of goods coming in therefore supply will increase. There will
then be a gain for domestic producers as they supply at a higher price and imports have
decreased. AD can shift to the right causing a forward multiplier effect. It will protect…

Page 4

Preview of page 4
Harry Bindloss




3. Protection against low-wage foreign labour ­ Cheap foreign labour allows foreign
firms to then have advantage over the domestic firms. However cheap labour a
source of comparative advantage.

4. Protectionism against `unfair' foreign competition ­ On the part of foreign
businesses takes the form of two particular…

Comments

davidsalter

Report

This is a sound document that analyses trade barriers well although it needs further evaluation. Good graphs on quotas and tariffs.

Similar Economics resources:

See all Economics resources »