Essay on Effects Of Trade Liberalization On Efficiency And Growth

Essay on Effects Of Trade Liberalization On Efficiency And Growth

Length: 883 words (2.5 double-spaced pages)

Rating: Better Essays

Open Document

Essay Preview

Literature Review
The effects of trade liberalization on efficiency and growth is a heated debated among modern-day economics (Stiglitz, 2006). Over the years, Trade agreements and trade liberalization have built a reputation of content and animosity among Economists. From the impact of trade liberalization on the environment and the subsequent disguise of protectionism as environmental protection (Harold, Runge, & University of Minnesota, 1993) growing inequities and the disparity in agricultural production, limitations in the access of markets and discriminatory trading policies were at the core of the Uruguay negotiation rounds in 1995 that led to the Creation of the World Trade Organization (WTO). The WTO 's non-discriminatory principles meant that each country would treat all others the same— the bedrock of the multilateral system (Stiglitz, 2006) while including, the principle of national treatment: both foreign and domestic producers would be treated the same, and be subjected to the same regulations.
Supporting literature on the benefits liberalization models a scenario where a 50% decrease in agricultural subsidies, tariffs and OECD support on agriculture finds that trade liberalization in agriculture will lead to an overall expansion of agricultural markets simply put, because the countries involved would gain continuous access to other markets. Similarly, economies of scale would have opportunities for to be fully employed and thus, maximized. Lastly, Global Trade would see an increase of 12% in the short run, compared to a 15% in the long run (Meijil & Tongeren, 2004). Effective trade liberalization would emphasize the different strengths and weaknesses of the countries involved led as well as their comparative advan...


... middle of paper ...


...etter access to manufactured goods. Supporting Literature found that further economic cooperation among these two countries could yield positive results in the long run.
Given that EU (including the Netherlands)- and the US together, accounts for over the half of the world 's population an increase in global trade and investments it would in turn reduce trading cost among both countries and overall convergence of both economies. To illustrate this a modeling trading scenario where trading barriers would be decreased by 25% and a 75% decrease in manufacturing would boost not only GDP but also an increase both imports and exports for the US and the Netherlands (Van Berkum, Rutten, Wijnands, & Verhoog, 2014). The following research takes a look at this historical partnership and the reaping benefits of improved, closer agriculture trading relationships after the DDA.

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Essay on Regional Trade Agreement

- The political force moved away from the painstakingly and time-consuming technique of multilateral tariff negotiations to smaller regional and bilateral provisions - the Regional Trade Agreement. In these arrangements; members accord preferential treatment , basically agreeing to liberalize the exchange of goods and services amongst each another giving regard to certain trade barriers. RTA is not the first-hand way of trade liberalization though. Initially, when multilateral trade discussions used to happen, two-sided and multiparty FTA”s filled the vacuum....   [tags: barriers, liberalization, free, trade]

Better Essays
2292 words (6.5 pages)

The World Trade Organization Essay

- The World Trade Organization is widely known as an organization that deals with free trade on an international level. Quoting from their website, “the World Trade Organization (WTO) deals with the rules of trade between nations at a global or near-global level. But there is more to it than that.” (Source 1). In general to enter into the WTO, a country must meet certain criteria that deal with liberalization of trade policy. (Source 2. More like a general). As a member of the WTO, countries must adhere by rules and regulations set....   [tags: Taiwan]

Better Essays
893 words (2.6 pages)

Essay about Political Arguments and Rationale Behind Trade Intervention

- The following essay aims at highlighting and analyzing the main political arguments for trade intervention and the rationale behind this. Firstly, what should be noted here is that international trade has been providing different benefits for firms as they may expand in different new markets and raise productivity by adopting different approaches. Given that nowadays marketplace is more dynamic and characterized by an interdependent economy, the volume of international trade has grown substantially in recent years, reducing the barriers to international trade....   [tags: Oil Policies, National Security]

Better Essays
1312 words (3.7 pages)

International Free Trade and World Peace Essay

- International Free Trade and World Peace When analyzing trade’s effect on state behavior, it is not the mere existence of trade between countries that should be central, rather, the nature of trade that is crucial. This distinction will be explored by studying the arguments of key economic and political thinkers of both the 18th and 20th centuries. The general nature of trade, the role of national government regarding trade and security, trade's capacity to befriend belligerent nations, and finally, the influence of international economic institutions will be explored....   [tags: Politics Political Science Essays]

Better Essays
6207 words (17.7 pages)

Regional Trade Agreements And Trade Liberalization Essay

- In examining the latter part of the 20th century and the 21st, it is interesting to note the regional trade agreements and global trade liberalization and the changes that have occurred. Regional trade agreements and global trade liberalization have experienced many changes in policy which have been strongly debated amongst economists and politicians, alike. The argument concerns which approach is an appropriate strategy for differing countries around the world and globally effective, as well. Impact of Regional Trade Agreements Trade liberalization and trade discrimination are both impacted by regionally based trade agreements....   [tags: International trade, Free trade]

Better Essays
1052 words (3 pages)

Trade Liberalization And The United States Essay

- Trade liberalization is also known as free trade, where each nation can trade freely with no trade barriers. The United States has pursued trade liberalization and has benefitted by doing so. Due to a trade imbalance, consumers are able to receive products at a cheaper price. Trade liberalization requires countries to have an open trade policy where countries can trade under fair and nondiscriminatory circumstances and being able to access each other’s markets. American consumers have increased their standard of living by enabling more goods and services through free trade....   [tags: International trade, Free trade, Economics]

Better Essays
1580 words (4.5 pages)

Openess Trade and Growth Essay

- The economic growth story is as long as the history of economic thought. Since the early classics like Adam Smith, David Ricardo and Thomas Malthus studied the issue of growth or introduced fundamental concepts such as diminishing returns and their relationship with the accumulation of physical or human capital, the relationship between technological progress and labor specialization or focus competitive analysis tool dynamic equilibrium. As part of these theories appears arises that relationship between trade openness and economic growth is positive....   [tags: Economic Development, Trade Liberalization]

Better Essays
1085 words (3.1 pages)

Essay about The Impact Of Nafta Association On The Canadian Economy

- Literature review This study is focused on measuring the economic impact of NAFTA association on the Canadian economy. A number of studies have been found that generally concentrated on the political and social issues such as reducing social assistance programs, improving education level, harmonizing standards and rules, increasing influx of migrants etc. Considering the fact that the existence of the NAFTA Agreement is relatively short the studies concerning this topic do not regard all aspects of this question....   [tags: International trade, Economics, Free trade]

Better Essays
1026 words (2.9 pages)

Essay on Effect of Trade and Investment Liberalisation on Individual Economies

- Effect of Trade and Investment Liberalisation on Individual Economies The liberalisation of trade and investment has increased greatly alongside the upsurge in globalisation due to financial and trade deregulation inturn bringing unprecedented benefits to individual economies. The removal of trade barriers such as tariffs, quotas and subsidies has caused a 16-fold increase in world trade since 1950. Consequently this has allowed for greater efficiency through specialisation, the expansion of markets for local producers, diffusion of technology and new ideas, greater consumer sovereignty and finally economic growth....   [tags: Papers]

Better Essays
1253 words (3.6 pages)

Liberalization Essay

- Is liberalizing Waynia in the best interest of the country?. I believe it definitely is. When you look at all the positives that come from being a part of a liberalized country, it is the clear-cut choice. Free trade is something that comes with being liberal. When you see how free trade can open up so many new markets to you and your country, you’ll see that it is the only choice. Along with free trade, you need to look at how conservatives think that input into political matters when you’re not a noble or king is bad....   [tags: essays research papers]

Free Essays
518 words (1.5 pages)