Describe how free trade works (ideally). In the discussion, be sure to address barriers to free trade associated with protectionist policies.
2. What are the principal arguments supporting free trade?
3. What are the principal arguments against free trade?
4. What regimes exist to promote free trade globally?
5. The law of comparative advantage holds that countries should concentrate on producing goods and services where they have a comparative advantage, rather than producing all the things they are good at producing. Since the 1960s, America’s comparative advantage has been in high tech products and advanced services. Because it does not have a comparative advantage in basic manufacturing (although it has always been good at manufacturing), it has ceded manufacturing efforts to developing countries, such as China, India, Taiwan, and Malaysia and has focused on strengthening its high tech and service sectors. The economic crisis of 2008-2009 has caused many thoughtful economists to re-think this long-standing policy. Why are they now beginning to question the US’s abandonment of basic manufacturing capabilities? (1-2 pages, single spaced)
6. It is generally agreed that China has done everything possible to avoid pursuing free-trade policies. Briefly explain. How do they get away with it? (1 page, single spaced)