Trade Barriers As international trade rises and countries around the world attempt to experience economic growth, each country faces the dilemma of balancing the interests of their domestic producers, local consumers, and the well-being of their international trade agreements that support the world’s desire for global trade efficiency (Carbaugh, 2015). Trade barriers represent the most significant component of the balance between free-trade, which encourages foreign competition and lower prices, and a country’s ability to self-sustain and promote national industry growth (Carbaugh, 2015). Therefore, each country must apply their trade barriers effectively in an effort to stabilize the benefits/downsides of increased competition and the protection
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Upon enactment in 1948, the GATT allowed countries to lower trade tariffs through multilateral negotiations that had reciprocal benefits for both imports and exports (Magee, 2011). Furthermore, the GATT played an integral part in recovering the trade war experienced in the 1930s that lead to the Great Depression and World War 2 (World Trade Organization, 2015). Presently, the World Trade Organization (WTO) lists the main benefit of their system as proponents and agents geared toward keeping the peace and allowing trade to flow efficiently (World Trade Organization, 2015). However, the author struggles to provide full credit to the GATT given that the United States has already been lowering their tariffs before their implementation and much of the reductions were categorized as specific, meaning that the tariffs declined as inflation rose. Additionally, Magee (2011) notes that preferential trade agreements between neighboring countries have been possible without the involvement of multilateral agreements. While the author is correct in his statements, the WTO and European Union remain a vital component in solving disputes regarding international trade, many of which can ultimately lead to a decrease in tariffs. For example, under the WTO’s Information Technology Agreement (ITA), the United States and China have recently approved a …show more content…
The author utilizes study results that support this explanation and indicate non-tariff barriers are significantly more restrictive than tariff barriers in both the United States and European Union. Therefore, the Magee (2011) contends that non-tariff barriers that limit the quantity of imported products while also affecting their domestic price are more harmful to economic growth. In a similar article, Solodkovska and Olefirenko (2014) propose that the increasing use of non-tariff trade protectionism can result in a trade war between nations, which can have an adverse effect on world trade as a whole. Although the WTO and other trade organizations attempt to analyze non-tariff barriers, problems of classifying their affects remain a problem (Solodkovska & Olefirenko, 2014). Yet, international trading partners are continuing to work together to overcome the negative effects of non-tariff barriers mentioned in Magee (2011) and Solodkovska and Olefirenko
Upon enactment in 1948, the GATT allowed countries to lower trade tariffs through multilateral negotiations that had reciprocal benefits for both imports and exports (Magee, 2011). Furthermore, the GATT played an integral part in recovering the trade war experienced in the 1930s that lead to the Great Depression and World War 2 (World Trade Organization, 2015). Presently, the World Trade Organization (WTO) lists the main benefit of their system as proponents and agents geared toward keeping the peace and allowing trade to flow efficiently (World Trade Organization, 2015). However, the author struggles to provide full credit to the GATT given that the United States has already been lowering their tariffs before their implementation and much of the reductions were categorized as specific, meaning that the tariffs declined as inflation rose. Additionally, Magee (2011) notes that preferential trade agreements between neighboring countries have been possible without the involvement of multilateral agreements. While the author is correct in his statements, the WTO and European Union remain a vital component in solving disputes regarding international trade, many of which can ultimately lead to a decrease in tariffs. For example, under the WTO’s Information Technology Agreement (ITA), the United States and China have recently approved a …show more content…
The author utilizes study results that support this explanation and indicate non-tariff barriers are significantly more restrictive than tariff barriers in both the United States and European Union. Therefore, the Magee (2011) contends that non-tariff barriers that limit the quantity of imported products while also affecting their domestic price are more harmful to economic growth. In a similar article, Solodkovska and Olefirenko (2014) propose that the increasing use of non-tariff trade protectionism can result in a trade war between nations, which can have an adverse effect on world trade as a whole. Although the WTO and other trade organizations attempt to analyze non-tariff barriers, problems of classifying their affects remain a problem (Solodkovska & Olefirenko, 2014). Yet, international trading partners are continuing to work together to overcome the negative effects of non-tariff barriers mentioned in Magee (2011) and Solodkovska and Olefirenko