International Business Theory and Practice

Order Description Free trade consists on the liberalization of trade, which abolishes all restrictions and barriers to in" rel="nofollow">international trade, and therefore, there is an unrestricted flow of goods and services (WTO, n.d.). The WTO (n.d.) defends that free trade ‘sharpens competition, motivate in" rel="nofollow">innovation and breed success’. Moreover, it has been demonstrated that countries with lower barriers to in" rel="nofollow">international trade experience faster economic progress (Rodriguez and Rodrik, 200: 261). Ben-David and Loewy (1998: 166) explain" rel="nofollow">in how this is true because of the exchange of foreign knowledge that occurs when countries conduct trade with each other. Some governments, however, are concerned about the negative effects that free trade may have on their countries and, therefore, implement protectionist policies in" rel="nofollow">in order to main" rel="nofollow">intain" rel="nofollow">in employment levels in" rel="nofollow">in developed countries preventin" rel="nofollow">ing their lose over developin" rel="nofollow">ing countries, and to protect in" rel="nofollow">infant in" rel="nofollow">industries of developin" rel="nofollow">ing countries that are not able to compete again" rel="nofollow">inst well establishes companies form overseas (Wall et. al., 2015: 98). Moreover, some protectionist policies are also in" rel="nofollow">in place in" rel="nofollow">in order to prevent dumpin" rel="nofollow">ing of foreign goods on domestic markets at low prices, and to protect strategically important in" rel="nofollow">industries such as steel in" rel="nofollow">in the UK (Wall et. al., 2015: 98). These protectionism policies, however, reduce the exchange of foreign knowledge between tradin" rel="nofollow">ing counties, and therefore, hamper the global economic growth (Ben-David and Loewy, 1998: 166). Moreover, as Wall et. al. (2015: 99) explain" rel="nofollow">in, protectionism policies have negative effects on multin" rel="nofollow">inationals, as it ‘disrupts the flow of goods from one stage of the production process to another’. Do you thin" rel="nofollow">ink that if all countries adopted free trade policies, without applyin" rel="nofollow">ing any kin" rel="nofollow">ind of protectionism policies or barriers, would there be an economic growth that would benefit everyone or would there be regions that would be adversely affected? Do you thin" rel="nofollow">ink global free trade is possible? support and justify your answer. consider the question from the followin" rel="nofollow">ing perspectives: Comparative and competitive advantage International in" rel="nofollow">institutions and world trade Barriers to trade and protectionist policies By the end of the discussion, you should: Understand the concept of free trade and how this manifests itself in" rel="nofollow">in the world today Appreciate the in" rel="nofollow">influence that in" rel="nofollow">international in" rel="nofollow">institutions have on in" rel="nofollow">international busin" rel="nofollow">iness Understand the practical limitations of classical trade theories