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WTO theories of trade
Role of WTO in trade
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TRADE, PROTECTIONISM AND THE DEVELOPED COUNTRIES The World Trade Organization refers to an organization formed in 1995 with a stated goal of supporting and liberalizing international trade. Although it is in line with free international trade it allows governments to impose short term protectionist measures under specific circumstances (Shrybman, 2001). Developed countries have imposed remarkable protectionist measures since 1975 despite the fact that they have joined WTO (Takatoshi and Krueger, 1993). An example of protectionism justification is Russia, which represents one of the strongest developed economies worldwide and is a recent WTO member since August 2012. The effects of its membership can be characterized as largely disappointing at least in the short term due to various reasons. According to the ministry of economic development of the Russian Federation, imports reported a substantial increase in the first half of 2013, while trade turnover and exports dropped significantly. As a result, the Eurasian Economic Commission, applied protectionist measures against agricultural combine harvesters and light commercial vehicles from several countries (Seeger, 2013). Therefore in the case of Russia protectionism is seen favourably up to the time being. Furthermore, a remarkable example of a developed country taking protectionist measures is that of the US against imports from China. The US has taken protectionist measures in 2013 in order to shield against patent infringement and trademark infringement by imported goods from China. The US International Trade Commission has conducted section 337 investigations which refer to quasi-judicial trade measures against various Chinese electronic companies. Here it should be noted t... ... middle of paper ... ...riers”. Moreover, the tacit knowledge model is being supported by the argument that when individuals come together under conditions which force them to share their ideas, knowledge gains are realized by the organization (Dixon, 2000). Therefore, collaboration between international companies and their local partner creates a unique opportunity for firms who want to expand internationally with respect to tacit knowledge gains. A remarkable example is the joint venture formulated by General Motors and Toyota in 1984 in order to co-manufacture cars in California. For Toyota, the main benefits were the acquisition of knowledge and experience with regards to U.S production patterns and the understanding of US labour management practices which proved very useful for the company when it started its manufacturing operations in the US a few years later(Clegg et al, 2011).
The light of the global recession, assess the likely economics effects of an increase in protectionism on the world economy. (15 marks)
Trade is the most common form of transferring ownership of a product. The concepts are very simple, I give you something (a good or service) and you give me something (a good or service) in return, everyone is happy. However, trade is not limited to two individuals. There are trades that happen outside national borders and we refer to that as international trading. Before a country does international trading, they do research to understand the opportunity costs and marginal costs of their production versus another countries production. Doing this we can increase profit, decrease costs and improve overall trade efficiency. Currently, there are negotiations going on between 11 countries about making a trade agreement called the Trans-Pacific
The United States has for over two centuries been involved in the growing world economy. While the U.S. post revolutionary war sought to protect itself from outside influences has since the great depression and world war two looked to break trade restrictions. The United States role in the global economy has grown throughout the 20th century and as a result of several historical events has adopted positions of both benefactor and dependent. The United States trade policy has over time shifted from isolationist protectionism to a commitment to establishing world-wide free trade. Free trade enterprise has developed and grown through organizations such as the WTO and NAFTA. The U.S. in order to obtain its free trade desires has implemented a number of policies that can be examined for both their benefits and flaws. Several trade policies exist as options to the United States, among these fair trade and free trade policies dominate the world economic market. In order to achieve economic growth the United States has a duty to maintain a global trade policy that benefits both domestic workers and industry. While free trade gives opportunities to large industries and wealthy corporate investors the American worker suffers job instability and lower wages. However fair trade policies that protect America’s workers do not help foster wide economic growth. The United States must then engage in economic trade policies that both protect the United States founding principles and secure for tomorrow greater economic stability.
Over the course of sixty years, the European Union (EU) has evolved to become one of the most economically and politically integrated regions in the world. Compare and contrast the EU with one other major global trading bloc, such as NAFTA or ASEAN, with which you are familiar.
With so much focus on the positive elements of free trade, the negative aspects of an open system are often overlooked. However, they do exist, and protectionism is needed. Consequently, safeguards are built into the system. States look out for their own good, whether that is through the use of escape clauses or the choice of the optimal forum for dispute settlement based on the precedent they do or do not want set. This paper argues that protectionism is valuable and inherent in the current system; however, not enough. Powerful states exploit weaker states, and “free trade” exacerbates the problem. I will first discuss why free trade does not work. Then, I will explain how the current system enables the inherent protectionist attitude of states. Finally, I will analyze the fairness of the system.
In the acclaimed novel, The Choice: A Fable of Free Trade and Protectionism, author Russell Roberts, an economist and writer, tells a fictional story that enlightens readers to the wonders of the economic system. Russell provides an insightful, thought provoking story that illustrates protectionism and free trade, while making the concepts and arguments easy to comprehend.
The systems of political and socio-economical value are some of the most important when it comes to countries survival. The countries in today’s world, some prefer to be as involved and as cooperative globally as others, while others prefer to stay to itself and prefer to be as away and as uninvolved to the global efforts as possible. The terms for these as explained would be globalization, Globalization is a process of interaction and integration among the people, companies, and governments of different nations, a process is driven by international trade and investment and aided by information technology, and protectionism, protectionism is the economic policy of restraining trade between states (countries) through methods such as tariffs on imported goods, restrictive quotas, and a variety of other government regulations. The two policies both have their own pros and cons, but in the end, globalization is the best choice to go
Morrison, Wayne M. "China and the World Trade Organization." Congressional Research Service (CRS) Reports and Issue Briefs. Congressional Research Service (CRS) Reports and Issue Briefs, 2002. Academic OneFile. Web. 3 Oct. 2011.
Tsang, E.W.K. (2000), ‘Transaction Cost and Resource-Based Explanations of Joint Ventures: A Comparison and Synthesis’, Organization Studies, 21(1): pp. 215-242.
Sharing of knowledge, technology, and capital that are brought to the company by the partner.
The following essay aims at highlighting and analyzing the main political arguments for trade intervention and the rationale behind this.
Krugman, P.R. (1987) Is free trade passé? The Journal of Economic Perspectives, 1(2), 131-144. Retrieved from http://dipeco.economia.unimib.it/Persone/Gilli/food%20for%20thinking/simple%20general%20readings%20on%20economics/Is%20Free%20Trade%20Passe.pdf
Effective knowledge transfer through a conversion of tacit knowledge to explicit knowledge can build a sustainable capacity to innovate within an organization and gain an external competitive advantage.
Globalisation has been one of the most significant developments of the last half century, and issues such as trade and international commerce have become increasingly important. In consequence, problems such as poverty, unfair wages and poor working conditions in third world countries have been drawn to the attention of consumers (Hayes and Moore, 2007). This is a growing global issue which cannot be ignored by anyone concerned about the problems in developing countries. Free trade and Fair Trade have both been offered as solutions to these issues.
Access to resource - One of the reasons to collaborate is to take advantage of resources. For example, an inter-company collaborates to place a product in the market where one compa...