Question

What are the arguments for and against open markets and free-trade policies? Which do you find convincing?

Answer 1

Followings are the arguments for open markets and free-trade policies;

1. It will generate advantages of specialization. As we know that every country have some specific strengths & specialization and if we have open markets and free-trade policies then there will be free movement of such specialities throughout the world.

2. It will helps in worldwide & overall prosperity because due to open markets and free-trade policies every firm of every country have free access to every corner of the world that is why there will be worldwide development.

3. It will boost competition amongst the firms of the globe that is why all products & services will be of greater quality at reasonable prices for the customers.

4. Every customer can have products and services of every type and from every country due to open markets and free-trade policies.

5. It will help more international and greater geographical co-operation.

6. It will help in better protection of diversity throughout the world.

7. It will help in wide expansion of local culture & traditions with the help of free trade & open market.

8. Open markets and free-trade policies, reduce the chances of undue interference of the government and regulating body. As a result market and trade will go more smoothly.

9. It will result into higher employment and per capita income.

10. It will also helps in better utilization of untapped resources located any part of the world etc.

Followings are the arguments against open markets and free-trade policies;

1. It can hammer on the under developed country or least developed coountry because these countries are not in position to fight with the firms of developed countries.

2. Due to open markets and free-trade policies, there are higher demand of modern technologies which may lead to destruction of traditional & core small industries in the under-developed countries.

3. It may also lead to some severe environmental issues as well.

4. Due to higher profit motives, some major firms focuss on the unnecessary reduction of the production cost which can hammer on the quality of the products & services.

5. It may lead to higher dependence on the developed countries.

6. Sometime some harmful products can make place in the market which are very dangerous to a particular country of to a particular geographical location.

7. It may lead to higher capitalism that is why man-made products can be ignored etc.

Thus on the basis of above arguments, it is true that open markets and free-trade policies have both positive and negative impacts but there are higher positive impacts. Apart from this it is demand of modern time that there should be free movement of goods & services that is why open markets and free-trade policies is necessary for every country although some protection for the under-developed countries and least developed countries are required alongwith open markets and free-trade policies.