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Delve into the world of protectionism and free trade, exploring the motivations behind these economic policies and how they shape international relations. From tariffs and quotas to embargoes and subsidies, learn how different strategies influence global trade dynamics. Dive into the debate on whether protectionism safeguards national interests or hinders global economic prosperity.
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Motivation • “Protectionism is the ally of isolationism, and isolationism is the Dracula of American foreign policy.” • William G Hyland
Protectionism • The idea that we should limit trade to protect our self-interest.
Tariffs • A tax on imports.
Protective Tariffs • Tariffs used to limit international trade in order to protect a country’s own interest. • Usually an elastic demanded product.
Revenue Tariffs • Tariffs that are used primarily to raise money for the government. • Usually an inelastic demanded product.
Quota • A limit on the number of imports and exports.
Embargoes • When a country halts the export and import of a product or a group of products to or from another country.
Standards • A requirement that foreign goods meet a certain stiff requirement.
Subsidy • A payment made by the government to encourage some activity (opposite of a tax).
Price Ramification • Graphing the use of protectionism.
