Question

"Free trade policies encourage developing countries to continue to use child labor in production and necessarily increases unemployment here in the United States". Explain why this statement can be debunked as a misconception.

Answer 1

Free trade policies or free market poilicies actually mean that there is no government restriction in the import and export of goods in international market . There in import quotas , barriers , taxes , tariffs etc . That does not imply that there cannot be employment age restrictions in the country . Developing countries , in order to increase their gains from trade , may employ abundant child labour , since child labour is cheaper form of labour . This also reduces their cost of production and thus the price of the product in international market . So developed countries like US import more of this cheaper variety of the product , thus throwing their own domestic labourers into unemployment .

But free trade policies does not mean free employment policies . In many developing countries practising child labour is a punishable offence . Also the United Nations has started new policies , whereby only goods carrying tags that no child labour has been used to manufacture it are traded in world market . Labour regulations can be followed in every country to prevent child labour and also excessive unemployment . So this is a misconception .