Question

Is free trade fair? Trade theory suggests that specialization and free trade benefits all countries. However, a case can be made in some situations for imposing trade barriers. Discuss.

Answer 1

Free trade is a kind of trade policy that does not keep restrictions on imports and exports. There are numerous benefits of free trade as well as demerits or difficulties when it coes to its practical implemetation. It facilitates unrestricted access to market and market information. Easier trade if goods without taxes. Thus goods are made available at a cheaper rate which in turn reduces the production costs or costs of production thus increasig the turnover. But coming to the demerits , unregulated access to market information may cause economic damage to a country. It can cause massive unemployment as goods are now available at a cheaper rate at overseas than within the country. Thus free trade indeed has huge merits if drawbacks are tried and eliminated to an extent.