StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...

Free Trade Among Developed Economies - Research Paper Example

Cite this document
Summary
Free trade among developed economies First name Last number here Month-name day, year Free trade among developed economies Free trade may be defined as the unrestricted international exchange of goods with tariffs used for the purposes of revenue generation; agreements are simply treaties establishing the parameters of the free trade exchange occurring…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER91.2% of users find it useful
Free Trade Among Developed Economies
Read Text Preview

Extract of sample "Free Trade Among Developed Economies"

Download file to see previous pages

The question then remains, should these be pursued by more economically developed nations? An example of this would be the North American Free Trade Agreement otherwise known as NAFTA which included Mexico, Canada and the United States in a limited free trade agreement. Unfortunately, this agreement has seen tariff wars occur, in some circumstances causing large deficits. According to one working paper from the California Western School of Law, published 2005. “In response to U.S. restrictions on Mexican sugar, President Vicente Fox placed a 20% tax on all soft-drinks not sweetened with Mexican sugar.

The “sugar tax” followed shortly after the DSB’s determination in the HFCS case, in which the Body held that Mexico failed to prove HFCS imports were threatening the Mexican sugar industry so as to warrant the imposition of antidumping duties. As a result of the sugar tax, the United States filed another complaint with the DSB” (Vacek-Aranda, 2005). With the increased taxation and import tariffs being bandied at this time it would seem to nullify the idea of free trade. However, once these disagreements are worked out there is a substantial benefit to be had for the economies of all involved nations.

To understand better why free trade is a necessary aspect of international trade among developed nations we should review what a developed nation is. A developed nation is simply a more economically developed country. This term is obviously ambiguous, however, can apply readily to those nations classified as first world nations. Some of those more economically developed countries or MEDC, would be Great Britain, Germany, Brazil, United States, Spain, Denmark and similar. According to a policy brief from International Institute for Applied Systems Analysis dated 2008, “The scenarios show that investment in education pays off in terms of higher long-term economic growth” ("Economic growth in developing countries: Education proves key," 2008).

This means only that nations with a more solid educational system and opportunities are more likely to be higher developed economic powers. Some arguments against the implementation of free trade agreements do so based on the non-members losses or reductions in ability to trade. However, the argument must be made that the implementation of a free trade agreement is a positive benefit in most cases. Arvind Panagariya et.al. outlines; “clearly, the initial equilibrium matters since that is crucial to the determination of the absolute level of consumers’ surplus relative to producers’ surplus” (Panagariya & Duttagupta, 2000).

Simply put the importance of an equal footing is initially necessary when looking at setting up a free trade agreement. The effects on surrounding nations that are not at the same stage of economic development are important to note as well. Primarily the argument can be made that pollution in underdeveloped nations will likely increase. An article in American Economic Review dated 1998 says, “Under the pollution haven hypothesis, poor countries get dirtier with trade, whereas rich countries get cleaner” (Antweiler, Copeland, & Taylor, Sept, 1998).

While this can be a detriment globally over time it should be noted that once a

...Download file to see next pages Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Free Trade Among Developed Economies Research Paper”, n.d.)
Free Trade Among Developed Economies Research Paper. Retrieved from https://studentshare.org/business/1439677-should-free-trade-agreements-be-made-among
(Free Trade Among Developed Economies Research Paper)
Free Trade Among Developed Economies Research Paper. https://studentshare.org/business/1439677-should-free-trade-agreements-be-made-among.
“Free Trade Among Developed Economies Research Paper”, n.d. https://studentshare.org/business/1439677-should-free-trade-agreements-be-made-among.
  • Cited: 0 times

CHECK THESE SAMPLES OF Free Trade Among Developed Economies

Greater Arab Free Trade Agreement

 This research paper describes the Greater Arab free trade agreement came into existence.... hellip;  The Greater Arab free trade Agreement was signed and brought into existence in the year of 1997.... nbsp; The Economic and Social Council runs and manages the Greater Arab free trade agreement and has involved Algeria as another member state in 2009.... (Abedini and Peridy 4-6) Economic Motivation behind the GAFTA Agreement A larger number of research articles have been written in favor of and describing the nature of the Greater Arab free trade agreement without entailing or outlining the economic motivation and the economic benefits that are being derived from this agreement....
5 Pages (1250 words) Research Paper

Globalization

Globalization Introduction Globalization, one of the developments of the twentieth century, defines interactions in an international web that link communication channels, cultures and economies.... Its concept of interlinked domestic economies and developed international transportation and communication infrastructure for example allows more players, who were previously disadvantaged, to gain access and explore foreign markets.... (WTO, 2012) Differences between an open and a close economy The major difference between open and closed economies is their different exposure to international markets....
3 Pages (750 words) Research Paper

The Economic and Social Impact of Free Trade

free trade assumes there will be no government in­tervention and ensures all parties benefit from the interaction.... Globalizations foster free trade, which further allows goods and services from all over the world to compete with domestic products and services (Hanson, 2010).... … free trade involves the opening up of economies or trade liberalization, which enables the trading countries to maximize their competitive advantage and increase their output with an aim of boosting the economy of their citizens (Greenpeace, 2013)....
2 Pages (500 words) Essay

Fair system of international trade

Although having a completely fair system of trade seems far-fetched and utopian given the existing inequalities between countries, trade strategies employed by developed countries and huge global corporation can be fashioned in such a way as to allow a fairer system of trade.... Most developed countries have enacted laws that although are aimed to protect the interest of the citizens, affect the smooth development and operations of international trade around the world....
10 Pages (2500 words) Essay

From the Andean Trade Preference Act (ATPA) to Free Trade Agreement

This paper under the headline "From the Andean Trade Preference Act (ATPA) to free trade Agreement" focuses on the fact that international trade is an important institution that has evolved during the past decades and transformed the relationships between nations.... nbsp;  Latin American free trade experience started in Mexico and spread out to Central and South America, and has included multiple negotiations between the United States and several countries....
13 Pages (3250 words) Case Study

Multilateral Free Trade

The essay "Multilateral free trade" states that Jagdish Bhagwati, an international economist states that the preferential trade agreements endanger the global trading system.... impose rules on other weaker partners that are rejected by other economies such as the Indian and the Chinese economies (Bhagwati).... Without the multilateral trade agreements, templates developed by big economies such as the U.... is seeking major emerging economies with similar ideas about the trade so that they can form their own templates....
1 Pages (250 words) Essay

Intra-Trade Industry as a Component of World Trade

Creation of free trade will improve on imports in the country to cater for the varying consumer preference (Donnan 2013, p.... This is due to the economies of large scale production that ensures a decrease in total cost with increased production, especially in manufacturing.... With the large local market, the country benefits from economies of scale in the production of the particular product.... Theories have been developed to explain the increasing intra-industry trade, including technology-based theories, new trade theories and the national competitive advantage....
8 Pages (2000 words) Research Paper

The Effects of Fair Trade on the Third world Countries

Another group consists of free trade and plead in favor of protection....  (Buffie 2001) The former group or the group belonging to the orthodox though are known as the liberalist and the second group which is strictly against the free trade and in favor of protection are known as protectionists.... free trade encourages the international division of labor.... It implies that free trade promotes specialization according to comparative advantage and in this way, there is an international division of the workforce according to the efficiency....
15 Pages (3750 words) Research Paper
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us