The Free Trade And Trade Barriers?
According to Mankiw’s statement, during the process of trade, there will be a winner and a loser; theoretically, the winner could compensate the losses of loser, however, in the reality, this kind of compensation is very limited; if the compensation does not exist, it will cause the losses of some countries. In order to protect their own benefits, some governments use the trade barriers, such as tariff, to prevent their own countries from suffering the pressure of competition from other countries. We call it protectionism. However, some people think that the protectionism couldn’t promote the efficient industries in the world field, which free trade could achieve. Now, the question is coming up, should the government support the free trade or protectionism? In long run perspective, the government should practice the free trade, however, the trade barriers are also necessary for some situations; therefore, the best method is to support the free trade but also to use the trade barriers to deal with