Wednesday, May 1, 2019
What do You Understand by Economic Protectionism Essay
What do You Understand by Economic Protectionism - Essay ExampleFree trade is known to be more favorable to consumers and indeed such security measuresism hurts the consumers more (Lee, 2001). The reason for this is mostly consumers pee to buy low quality goods at a higher p sift. The quality of goods obtained at this is far more inferior. They even have to pay higher taxes in order to help the government bear the burden of subsidies. They be of left with little choices since foreign products are lowered or eliminated by imposing restrictions. The case is worst when it comes to essential commodities like food grains, salt, and sugar. The policy-making argument offered for such protection is to have a fair trade. This means either the government is stressful to make the domestic industries more competitive in international market or it wants to strike a balance between importing goods and maintaining domestic production. Although it is argued that producers are favored with this policy of protection but at the same time they are losing consumers on account of this. Not all industries and firms are receiving protection and subsidies. The ones take of such facilities are again diversely hit as they try to increase productivity (Lee, 2001). Economists have also favored free trade than such protection because trade carries the advantages of increased productivity and employment. hitherto real life case examples will help to point out the implications of such protection. Japanese protection for sieve production can be cited as an example. Japanese people had been worshipping rice as divinity fudge and had been fighting to protect rice production. Japanese government has offered subsidies to rice farmers (Barlett, 2006). This and prevention of foreign rice imports has been adopted as strategies for protection. Previously heavy snowing has distorted rice...These policies are adopted when the rural is giving more grandness to development of domestic industrie s rather than engaging in free trade. Economic Protectionism has tremendous influence on consumption as well as production. But the impact is more on the production side. sometimes protection is offered to some scale industries who hardly show any incentive to grow and just waste the opportunities and facilities offered by the government. Neither they have any incentive to innovate and produce better quality products. The country suffers a loss of revenue that it could have earned from trade. This is because other countries retaliate in a similar manner by imposing restrictions on the countrys exports. Government is worse off by losing revenue from trade. In some cases the government also offers subsidies to the industries for growth which is helpful only if the industry has the potential difference to compete with its foreign counterparts.Moreover urban development demands more landscapes for which they are concentrating on acquisition of rice fields. This will make farmers lose their livelihood. So the government has stepped forward to protect rice farming. It restricts cheap merchandise rice from entering Japan and at the same time helps the farmers with a support price. Hence rice farming protection can be considered justified here.