Difference Between Protectionism And Isolationism

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Free Trade or Isolationism
In principle, we can take for granted that free international trade brings the maximum benefit to world economy. If two countries completely remove trade barriers on the way of commodity streams, both of them will be the winners, and total growth rate of economies of these countries will be at maximum. However, it is never impossible to claim that the prize from free trade will be identical to both countries, most likely one country will win more, than the other will, growth rate of economy of the first country will be for certain higher, than at the second. Therefore, the second country will feel in the beginning offended, and then will start worrying about the safety because of too rapid growth of the first country.
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While the decline in protectionism since World War II has stemmed partly from unilateral changes in trade policy by countries, it also has been a result of agreements among countries to liberalize their trade policies” (112, 118). In process of development of world trade, a question of participation of the state in this process has been more and more topical. For today, two concepts of the state relation to world trade have been created and implemented, as for protectionism and freetradism. The idea of protectionism in foreign trade is formulated by mercantilist in the 14th and 15th centuries. Its essence is in interests of own national production of the state actively regulating foreign trade, in every possible way encouraging export and limiting import. During industrial revolution, the concept of free trade was widely extended. According to it, the state pursues policy of liberalization of foreign trade, opening domestic market for foreign goods, the captain and labor. In real life, the state in the foreign trade policy is compelled to create elements and protectionism, and freetradism. Anyway, today the state has not only to proclaim the concept of policy in foreign trade, but to carry out measures for its realization, using various tools. As a rule, they are divided into two groups. The …show more content…
They incorporate administrative ban on import, quantitative restrictions (so-called quoting), introduction of standards of health care, safety, environmental friendliness, establishment of level of minimum price, introduction of rules on packaging and marking. Thus, the state, using various tools of regulation of volume of commodity streams from country to country achieves certain results in sheathe to economic

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