Minimization of World Conflict Through Trade and Business

In terms of efficiency, free trade thus means that every state should play to maximise their specialisation of production and to minimise doing less efficient tasks (Kindleberger, 1995). Liberals believe that specialisation will improve the welfare of an individual country and that of the world as a whole if countries specialise in one task according to their comparative advantage (O’Brien and Williams, 2013). Moreover, nation states can expand their businesses with foreign direct investments, and this leads to more dynamic business style. Free trade opens up a door to the world for every single state, and domestic companies can export and import their commodities without paying extra tariffs or tax. Eliminating trade barriers creates a field which people can play a role internationally to compete one another in order to improve national as well as international economy (Balaam, and Dillman, 2011b).

Free Trade, Globalization and International Conflict Burak Sezer Coskun In today’s increasingly smaller world, free trade and globalization have become inevitable parts of our lives. The growing importance of free trade and globalization have undoubtedly impacted the existence and extent of conflicts between nations. Free trade is defined by Mankiw (2015) as “the unrestricted purchase and sale of goods and services between countries without the imposition of constraints such as tariffs, duties and quotas.” The economic argument for free trade is that nations that engage in it will be able to produce and consume more due to the principles of absolute and comparative advantage. More recently, arguments in favor of free trade have emerged not

In conclusion, the traditional models in international trade of constant returns to scale and perfect competition have been supplement by new models which is increasing returns and imperfect competition. Free trade in not passé, but its lost its innocence; free trade is still a good police. However, the world of economy improved, and free trade should improve as well. "free trade is better than no trade" as Krugman pointed out.

(Rugmann and Collinson). Arguments for free trade Trading Barriers If nations adopted a free trading policy the total cost of tariffs, duty on imports, would be reduced; resulting in a cost efficient method of international trade. Alongside specialising in an economic activity within one nation, a reallocation of resources for more efficient nations allows trade to be fair and enhance the quality of resources. The reduction of trade barriers enables the local prices of goods to reduce too, which will eventually lead to an enhancement in the economical welfare situation of nations by reducing the limitations of new entrants into the markets. The removal of barriers would mean a free and fair opportunity for all nations to gain impartial access into any market benefitting them with a fair chance in competition.

This stress on a foreign market, though not supported by everyone, is a very positive way for a national economy to thrive. This economic idea encourages the cooperation of the entire world to combine in their economic relations to mutually benefit from each other. An analysis of globalization will reveal that it is a successful method for strengthening the economies of many nations. There are several reasons to support globalization. The direct foreign investment and international trade are generally supported because it provides for a breakdown in monopolies, innovation, and promotes peace.

Whether it being positive or negative depends on the politics that it spreads upon. Since the politics of Globalization allows the free flow of markets, goods and services easily across the globe, Liberalism comes in play allowing an extensively open market. Individuals who chase their economic dreams are allowed to flourish and succeed for the good and benefit of the consumers and the producers exactly as the “the fable of the bees” and Adam Smith’s idea of the “invincible hands” tells us. Individuals acting in their selfish ways economically is a whole betterment of the society. This being said, does not mean we completely throw away the “Marxist” ideas as the real purpose of globalization is to help all mankind and to create a better world for all humans.

The World Trade Organization is beneficial economically and we should support its principles. The original and main goal of the WTO is to remove trade barriers between countries, which is a major idea behind globalization. Anyone who knows the slightest bit of economics knows that trade is beneficial to a country as a whole. When free trade is allowed it opens up foreign markets for domestic producers. It also opens up the possibility of foreign competition in domestic markets.

1) Discuss the advantage and disadvantages of free international trade ADVANTAGES Increased Production The reason for exchange is to give access to a more amazing variety of products and services. As stated by the Heritage Foundation, free trade fosters rivalry, impelling organizations to enhance and create better products keeping the costs low and high quality. Free trade permits organizations to concentrate on the merchandise or services that they do best. International trade builds a companies market share. As a result of which cost is decreased and the productivity is increased, prompting higher rates of production.

Businesses and workers have long thrived in the international economy. In recent years some countries have implemented national trade policies that unfairly favour their workers and companies; this is where fair trade agreements are introduced. Free trade helps create a more level playing field for national businesses and workers to succeed. Trade within the group is duty free but members set their own tariffs on imports from non-members (World Trade Organization, 2015). These agreements create a more accountable and fair trading relationship between two or more countries.

Compared to the foreign competition, the free trade benefits outweigh any risks the foreign competition might impose on the US. As said by Denise Froning in her article, free trade benefits in four ways. “Free trade promotes innovation and competition, Free trade generates economic growth, Free trade disseminates democratic values, and Free trade fosters economic freedom.” Societies that enact free trade policies create their own economic enthusiasm, nurturing freedom, job opportunities, and success that benefit every citizen. Free trade is the only type of fair trade because it offers consumers the most choices and best standards to improving their type of living. Also by fostering opportunitie... ... middle of paper ... ...5136151&SrchMode=1&sid=7&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1305662985&clientId=16112 http://proquest.umi.com.libraryaccess.sdmiramar.edu:8080/pqdweb?index=40&did=2206588801&SrchMode=1&sid=7&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1305662985&clientId=16112 http://proquest.umi.com.libraryaccess.sdmiramar.edu:8080/pqdweb?index=12&did=2292170531&SrchMode=1&sid=2&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1305668018&clientId=16112 http://proquest.umi.com.libraryaccess.sdmiramar.edu:8080/pqdweb?index=12&did=2292170531&SrchMode=1&sid=2&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1305668018&clientId=16112&cfc=1 http://proquest.umi.com.libraryaccess.sdmiramar.edu:8080/pqdweb?index=59&did=2250917791&SrchMode=1&sid=2&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1305833247&clientId=16112 http://benefitof.net/benefits-of-free-trade/