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Free Trading

In: Business and Management

Submitted By foyabie
Words 473
Pages 2
Arguments in Favor
The most common argument in favor of free trade is that it permits the market to most efficiently price goods and services on the largest possible scale. As governmental barriers to trade---such as taxes, tariffs and regulations---are lifted, proponents say the cost of providing a service or producing a product will decrease, and this lower price would be a net good for society. In general, large-scale production is more efficient than small-scale production and leads to greater profits, which drive further efficiencies, including more advanced technology.

Some political scientists say free trade improves national security by making nations so economically interdependent that armed conflict becomes an increasingly remote possibility.

Furthermore, some say that the right to labor includes the right to engage in some degree of market capitalism that includes trading with the partners of one's choice, irrespective of national borders. As individual entrepreneurs pursue their own self-interest, they accumulate capital that can be used to subsidize the arts and culture within their communities.

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Source For Verified Manufacturers & Wholesale Suppliers. Register Now! www.GlobalSources.com Arguments Against
Opponents of free trade argue that the economic benefits of trade are outweighed by the hidden costs. For example, free trade tends to promote the formation of large business enterprises such as multinational corporations that accumulate profit at the expense of local, smaller enterprises. In addition, foreign capital can cut off young industries from blooming in developing economies, fostering a dependency on foreign businesses and potentially undermining the competitiveness of local firms.

Additionally, some say that free trade undermines cultural diversity and can make some economies dependent on…...

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