The United States will benefit from free trade because the market to purchase U.S. made goods and services will increase dramatically in size, thus increasing trade revenues. By doing so, the U.S. can specialize the production of such goods and services in which they maintain a comparative advantage in, while importing products from other nations at a more cost-effective price for the benefit of the consumer. As of late, the debate of free trade has plagued U.S. foreign policy and caused many to question its overall successfulness however, the benefits of free trade severely outweigh the losses. Free trade builds economies, balances power, and can ultimately decrease trade deficit. While the U.S. is still developing its foreign policy to adopt the concept of free trade, recent free trade agreements can justify the necessity for such policies.
This means developing countries are able to access new broader markets and expand their consumers which increase the number of exports and income. Secondly, developing nations can import technology and goods to improve their productivity for a cheaper price compared to import with high tariffs or attempt to produce domestically through free trade agreements. Thirdly, free trade also bringing capital and new ideas into developing countries through foreign investment which could improve production processes of developing countries. For instance, their resources will be used more efficiently to produce more high quality goods or even manufactures new kinds of valuable products. Fourthly, the progress of innovation, new production technique and advanced production processes will lead to economic growth of developing countries.
Globalization has global benefit and cause for concern. A few of the global benefits are more efficient markets, increased competition, stabilized security and more wealth equality throughout the world. More efficient markets is what the economy and the country should looking and hoping for. An efficient market help the country to see that there is a gesture that the market is working. If the market is working then there is a stability between what the sellers are willing to sell and what the buyers are willing to buy.
They would say that competition is healthy and necessary for economic growth. However, there are many reasons why trade barriers are beneficial and play an important role in international trade. Some of these reasons include being self-sufficient in producing military goods, trying to avoid becoming too specialized in our industries, keeping new industries alive domestically, protecting against foreign competition, and increasing domestic employment while reducing the number of jobs outsourced to other countries because of their cheaper labor
Better quality goods including more variation of goods and helping maintain closer relations between countries. There is better utilization of benefits and resources in the countries. Economic growth- in free international trade the countries involved in free trade experience rising living standards, increased real incomes and higher rates of economic growth. Larger market to sell, so more potential customers for firms Encourages exports and imports so consumers have more choice so a higher standard of living Firms produce higher quality of goods due to increased competition The negative points of Free International Trade are- Facilitated commerce system works effectively if all the countries contribute with each one in turn and take after this methodology. On the off chance that a few nations choose that a couple of countries decide to expansion more by driving import constraints, the plan of encouraged business can't work.
Modernization is another internal growth strategy. Market Penetration means that the company tries to grow by selling more of the same products to the existing customers. It aims to increase the sales profit and capture larger market shares (Sabharwal, n.d.). This can be done by attracting customers away from competitors and looking for potential customers to purchase the existing products (Kasi, 2009). The risks are low for this strategy because there is nothing new and unknown.
Due to an increase in the per capita income of the country, people become more stable financially and these financial situations help in the overall economic development of a country. This can be possible only with free trade that occurs due to international co-operation. Moreover, research conducted by Noguer and Siscart (2005, cited in Newfarmer & Sztajerowska 2012, p. 9) examined that 1% increase in export and import of goods and services leads to 1% improvement in the per capita income. This evidence shows that trade openness is directly linked with an increase in the per capita income which further facilitates the economic growth of a country because people have more money due to the increase in per capita income. This solves the financial
In conclusion, a market economy would be a better system for Mr. Robbins to use on his island, because it will benefits the businesses and the people. Market economy would provide cheaper and better quality goods for the people due to competitions. Competitions can also make people work harder, because if they do not work harder, they would lose their job. This economic system will also give people lots of economic freedom. As a result of a high degrees of economic freedom, the income of the poor would rise up and there will be economic growth.
Businesses are not only provide goods and services for consumers, but also improve the economy and increase jobs for people within society which is an additional fact producing a higher standard of living. Today there are many kind of business all over the world, Which enhances the economical level of people. But Sri Lankans mostly depend on their traditional business, which can be easier for them as they practiced from the past. So that they are well adapted to that system and they are able to compete with other countries too. As Sri Lanka is one of the growing country, nowadays they are using modern techniques in implementing their process in the field of their business they concerned.
The reduction of trade barriers as well as the invention and implementation of e-commerce and online businesses has made its easier for individuals, businesses and countries to import foreign goods and services into their countries and society. Not only does this benefit customers but it can also benefit companies as they have the opportunity to cater to a wider global market and have potential to grow their business and make more profit from a much larger customer