Chapter 20 Globalization and Protectionism
Import Quotas
-numerical limitations on the quantity of products that can be imported -increases the price of the domestic goods to consumers Ex. a limit imposed on the number of men's suits that can be imported from a foreign country
Non Tarriff Barrier
A rule that every imported product must be opened by hand and inspected with a magnifying glass, by one of just three government inspectors available at any given time might be referred to as
Tariff
A tax on imported goods and services ex.a $1000-per-car fee imposed on all small cars imported
National Interest Argument
It is sometimes argued that nation should not depend too heavily on other countries for supplies of certain key products. This argument is commonly known as the
example of tariff
a $1000-per-car fee imposed on all small cars imported
Which of the following is the best example of a quota?
a limit imposed on the number of men's suits that can be imported from a foreign country
economic unions
addition to a common market, monetary and fiscal policies are coordinated
GATT (General Agreement on Tariffs and Trade)
compromises between nations that come about due to trade policy
During the second half of the twentieth century, trade barriers have in general:
declined quite substantially both in the U.S. economy and in the global economy.
Introducing a tariff on vitamin Z would:
increase American consumption of domestically produced vitamin Z.
Import tariffs generally ________ the output of domestic producers of the affected products and also _________ the output of domestic exporters.
increase, decrease
After the USA introduces a tariff in the market for gigastraps, the price of gigastraps in the USA will:
increase.
Economists would say tariffs:
limit voluntary exchanges.
Nontariff Barriers
nation can draw up rules, regulations, inspections, and paperwork to make it more costly or difficult to import products
Disruptive market change
new technology- causes real tradeoffs
Free trade agreements
participants allow each other's imports without tariffs or quotas
common markets
participants have a common external trade policy as well as free trade within the group
Dumping
refers to selling goods below the cost of production
race to bottom
scenario of global degradation
International trade
tariffs are taxes imposed on imported goods and services