Free Trade Blog

In todays's modern world, almost no country has the ability to be self-sustaining. Not only does this mean increased amounts of work required, but people would also need to be specialized enough to complete jobs they normally would not do in order to produce everything needed. Additionally, producing everything domestically, while creating jobs at home, would also drive up the prices of most goods because domestic production would be more expensive. Luckily, most countries are not forced to experience this issue because they participate in trade with a multitude of other countries. Simply put, trade makes countries richer by enabling them to use time and resources wisely to specialize in the production of goods that they can make most efficiently. Countries decide what to produce based on comparative advantage, meaning they choose to specialize in whatever they are able to make the best and most efficiently. Trade also contributes to lower prices for many goods, particularly imported, because other nations have different work regulations and less costs go into making the item, so the overall price is cheaper as long as no tariffs are imposed. This eventually leads to a higher standard of living because consumers have increased purchasing power, similar to as if their incomes had increased. Trade is clearly beneficial to developed countries, but what most fail to realize and actually argue against is the fact that trade also helps poorer countries. Engaging in trade gives these poorer countries, which usually do a lot of manufacturing with cheap expenses, access to foreign markets and opens the door to trade with other countries, often times richer ones with money to spend. While there are some disadvantages associated with trade, its benefits clearly outweigh the cons. It has positive impacts on wealthy countries, poor countries, many industries, and many consumers. Right now, trade is helping many countries flourish and maintain a high standard of living but if more bans were imposed, we would see a decrease in both these things.