Question

Make the argument for why the United States should eliminate completely all of its trade barriers to imports from other countries-even if other countries continue to keep their barriers to U.S. products. Make the argument as strongly as you can utilizing the information in Chapter 21. Do you believe your argument? Explain why or why not using economic reasoning.

Answer 1

Trade barriers shrinks the choice available to consumers and therefore it increases the price that comsumers have to pay but in return they get inferior quality goods. By eliminating trade barriers, USA can help it's consumers to buy from more widely available goods and services choices with lower price and better quality.

Also, when both large developed and small developing countries imposes trade barriers, a trade war forms, by which the small countries are affected , because trade barriers generally favor large countries (like USA) as these countries set the international trade policy and standard on goods that developing countries are best at producing. Thus, small developing countries faces high barriers hurting it's poor farmers or producers. But because of trade war, economic efficiency in both small and large countries decreases. This situation can be eliminated if USA removes all of it's trade barriers.

The economic reasoning behind the argument is that, If large country like USA eliminates it's trade barriers it will help both American consumers and producers in small developing countries even if these countries keep their trade barriers to US products. Because, trade barriers imposed by small countries does not affect large countries economy or overall wolrld price at all.