If global trade becomes free of tariff and countries are allowed to import from the lowest price source what impact might this situation have on the World's economy?
2007-01-19 08:38:22 · 4 answers · asked by ButtErFlY 3 in Social Science ➔ Economics
It depends on the mobility of labor. If goods flow free across borders, but labor cannot, then prices generally will be a steal in some places, and unfair in other places.
In other words, for tariff-free trade to work optimally, then people would be able to work in whatever country they wanted, without work visas or the like.
2007-01-19 09:50:33 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Tariffs are a tax, and negative to a countries economy. At first, eliminating tariffs would hurt certain sectors, which would increase unemployment, but as time goes by the economy will makeup the lost jobs.
2007-01-19 10:03:38 · answer #2 · answered by Matt 2 · 0⤊ 0⤋
the rich company will use it's unlimited resources to buy all the goods and corner a particular market and charge what they want for the goods. I call it Global Monopoly. For example like Japan corners the market on electronics, the Middle East on oil, Africa on diamonds,and America controls the market on the cogs that thrives industries Computer Chips. How would the rest of the countries in the world fare in this market.
2007-01-19 09:50:29 · answer #3 · answered by King Midas 6 · 0⤊ 0⤋
Simple, everyone will be better off.
2007-01-19 08:59:23 · answer #4 · answered by KevinStud99 6 · 0⤊ 1⤋