What are the pros and cons of Free trade? Is it the best way or is there another alternative?© BrainMass Inc. brainmass.com December 15, 2020, 11:47 am ad1c9bdddf
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What are the pros and cons of Free trade?
Pros of Free Trade:
1. Benefits from the increased exports and imports: The greatest and most direct economic benefits from free trade arise from the fact that countries are not all the same in their production capabilities. They vary from one another because of differences in natural resources, levels of education of their workforces, relative amounts and qualities of physical capital, technical knowledge, and so on. Thus each country can concentrate its efforts on what it does best relative to other countries and export some of its output in exchange for imports of products it is less good at producing. As countries do that, total world output increases.
2. Free trade reduces prices: Protectionism is expensive because tariff and non-tariff barriers (NTBs) result in higher prices for consumers. Barrier costs are passed on to consumers, or consumers are forced to buy more expensive domestically produced goods.
3. Competition: Competition fosters lower prices, efficiency in production, and innovation.
4. Economic ...
The pros and cons of free trade is determined.