1 / 18

Barriers to Trade

Barriers to Trade. SSEIN2a: Define trade barriers as tariffs, quotas, embargoes, standards, and subsidies. SSEIN2b: Identify costs and benefits of trade barriers over time SSEIN2c: List specific examples of trade barriers. What are Trade Barriers?.

ralph
Télécharger la présentation

Barriers to Trade

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Barriers to Trade SSEIN2a: Define trade barriers as tariffs, quotas, embargoes, standards, and subsidies. SSEIN2b: Identify costs and benefits of trade barriers over time SSEIN2c: List specific examples of trade barriers.

  2. What are Trade Barriers? • Any form of governmental or operational activity or restriction that renders importation of some goods into a country difficult or impossible.

  3. Tariff’s • Definition: a tax placed on imports to increase their price in the domestic market. • Two types: • Protective tariff – designed to make domestic products cheaper than their foreign made rivals. • Revenue tariff – generates revenue for the government without making the product more expensive than the same domestic products.

  4. Tariff’s: • Costs: • Price of goods increases. • Reduced competition • Hidden costs of political and cross-industry retaliation.

  5. Benefits of Tariff’s • Protect young domestic industries from foreign competition. • Protect aging and inefficient domestic industries from foreign competition. • To protect domestic companies from “dumping” from foreign companies or governments.

  6. Examples of Tariff’s • In the year 2000, tariff’s were increased 8-30% on imported steel. • Goal was to save jobs in the U.S. steel industry. • Tariff’s are placed on imported cars depending on the value of the car.

  7. Quota • Definition: A specific number or proportion of a good allowed to be imported into the country.

  8. Quota: Costs and Benefits • Costs of Quota’s • Shortages • Higher prices • Benefits of Quota’s • Domestic job protection • Domestic industry protection

  9. Quota’s: Examples • In 1981, President Reagan put a limit on the number of imported cars that foreign car produces could bring into the United States. • Consumers had fewer cars to choose from • Prices were higher than they would have been without the quota. • Sugar quota’s have been in effect for 50+ years • Limits the amount of imported sugar • Protects U.S. sugar industry.

  10. Embargo’s • Definition: • A government prohibition against the shipment of certain products to a particular country for economic or political reasons.

  11. Embargo: Cost/Benefits • Costs: • Loss of imports • Human rights • Benefits • Political leverage • Increase in substitutes

  12. Embargo • Example: Cuba embargo began in 1963 and still continues today. • No imports or exports allowed • No free travel between the countries

  13. Standards • Definition: • Laws that promote the health and safety of products and services within the country.

  14. Standards: Cost/Benefit • Costs: • Increased cost of inputs • Increased prices • Decreased competition • Benefits: • Safer products • Higher quality products • Recourse against products not made to specifications.

  15. Standards • Examples: • Cars must have seat belts • Toys cannot be made with lead paint.

  16. Subsidies • Definition: a government payment to an individual, business, or other group to encourage or protect a certain type of economic activity.

  17. Subsidies: Costs/Benefits • Costs: • Protects inefficient industries • When repealed, costs go up and producers leave the market • Benefits: • Lowers the cost of production • Encourages current producers to remain in the market and new producers to enter

  18. Subsidies • Examples: • Dairy farmers receive subsidies to help them stay in business. • Research and production of biofuels

More Related