1. As a result of many rounds of the General Agreement on Tariffs and Trade and other trade negotiations, both tariff and non-tariff barriers have been significantly reduced on a worldwide basis.  However, given recent shifts in productive assets and employment from many industrialized countries to emerging economies, such as India and China, cries for protectionist measures can be heard from many quarters.  Consider the possibility that governments in industrialized countries will once again implement some form of protectionist measures in order to protect their markets and industries.  Do you expect that such measures would be in the form of tariffs or nontariff barriers?  Why?

2. Consider the issue of stakeholders in government trade policy; whose interests should be of paramount concern – producers, consumers, or the government?  Why?

peer response

1) Do you expect measures would be in the form of tariffs or non-tariff barriers as governments in industrialized countries will once again implement some form of protectionist measures to protect their markets and industries?

Trade protectionism is like a trade block, creating barriers with specific goals of shielding an economy from the negative impacts of international trade. There is the perception that jobs and industries could be lost to overseas operations without some form of action. Protecting consumers from inferior foreign-trade goods looks to hold import products to the same safety and production requirements domestic companies face, which hopes to level the playing field and a significant part of protectionism philosophies. The whole idea intended to safeguard domestic industries and jobs has a flip side of limiting product availability to consumers in the marketplace. Poor quality can be a result of reduced competition. Tariff barriers restrict imports of foreign goods and raise tax revenues. Non-tariff barriers such as subsidies or quotas can support domestic products and lower manufacturing costs by implementing subsidies, allowing a more even playing field in foreign markets. But global competition keeps prices down and gives consumers the ability to choose and spend. Looking at the possibility industrialized countries may implement protectionist measures, imposing tariffs will depend on whether domestic production can substitute imported goods. The other factor to keep in m mind is retaliation from a blocked trading partner, which negates the whole point of imposing tariffs, forcing a reversal of strategies given the magnitude of the retaliatory measures—a delicate game of cat and mouse.

"Governments intervene in trade to attain economic, social, or political objectives" (Daniels et al., 2015, pg. 275). Tariffs get attention and change behaviors quickly. But with that, tariffs can raise prices and limit trade as a side effect. I can see the likelihood of a combination starting with tariffs and tapering off to no-tariff measures such as the quota system to strike a balance between being aggressive and shutting down the ability of free trade to do what it does best. Ultimately, there are countries in the developing world you rely on commodity exports to supplement economic development so anytime tariffs or barriers cause restricting’s, there is a trickle-down impact.

2) Consider the issue of stakeholders in government trade policy; whose interest should be of paramount concern-producers, consumers, or the government? Why?

My first instinct is to say consumers would be of paramount concern as those that produce goods & services exist only at the need of the consumable marketplace. No consumer, no need for production. Governments enact laws or regulatory policies to define how economic activity takes place. Labor rules, tax policy, environmental regulations, and zoning policies involve a level of protecting consumers and producers. Policy measures guide norms and behaviors- the choices industry and trade make to meet consumer demand.

Source:

Daniels, J. D., Radebaugh, L. H., & Sullivan, D. P. (2015). International Business: Environments & Operations (15th ed.). Pearson Education Limited.