Answer to Question #282098 in Macroeconomics for kika

Question

There is an ongoing debate about whether free trade is beneficial for the global economy. Choose whether you support free trade or if you prefer trade barriers. Be sure to cite specific facts and figures to support your analysis. Remember that there may be more than one perspective that could be equally valid given the circumstances. 

Answer 1

Solution:

Free trade is not beneficial for the global economy but rather neighbouring countries. So I prefer free trade barriers.

If free trade is allowed globally it would affect or distort the world market economy as we know it. The following issues will arise if free trade is allowed globally:

• Massive job losses.
• Predatory pricing.
• Increased vulnerability since countries will loose most of their critical industries.
• New industries will fail to develop due to lack of protection needed.
• Tax troubles since free trade can hinder the ability of the government to collect taxes from domestic corporations.